Nera Telecommunications (Neratel) has reported group revenue of $22.8 million in the 1QFY2021 ended March, 33.6% lower than revenue of $34.4 million, due to a slowdown in project progression in various markets.
Segmentally, government, transport and utilities (GTU) saw revenue plunge 66.8% y-o-y to $3.6 million.
Service Provider fell 27.9% y-o-y to $14.3 million.
The lower segment revenues were mitigated by a 36.8% y-o-y increase in Enterprise to $4.9 million due to an increase in corporate investments in IT infrastructure to facilitate employees working from home amid the pandemic.
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During the quarter, Neratel saw total order intake fall 33.1% y-o-y to $27.0 million. This was in line with the general slowdown in most of the group’s markets and a result of the group’s conservative approach in the selection of new projects amid the Covid-19 pandemic.
Order intake for Neratel’s Enterprise segment rose 105.4% y-o-y to $9.7 million in the 1QFY2021. Q-o-q, order intake rose 81.1% from the $5.4 million in the 4QFY2020.
Order intake for the Service Provider segment lifted sequentially 49% to $16.4 million from $11.0 million in the 4QFY2020.
Neratel says it expects the Service Provider market to pick-up gradually with the 5G rollout.
Neratel’s Security business continued to gain traction from the 4QFY2020, registering an order intake growth of 70.7% q-o-q to $8.4 million in the 1QFY2021.
Order intake for the Security business, has, however, declined by 49.5% y-o-y, as the 1QFY2020 included a one-off sizeable $5.6 million contract from the government sector.
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“We continue to see demand from the market for cybersecurity solutions brought on by digitalisation and hybrid work arrangements,” says Neratel in its business update.
“As businesses increase their expenditure on cybersecurity to better protect against more sophisticated cyber-attacks, we are optimistic that our cybersecurity business will continue to grow in contributions to our total revenue in the next few years,” it adds.
On the ongoing Covid-19 pandemic, the group says it will continue to exercise caution and implement the necessary precautionary measures such as cost containment measures and the optimisation of working capital.
Shares in Neratel closed flat at 17.8 cents on May 18.
