SINGAPORE (Feb 13): SIlverlake Axis saw 2Q18 earnings fall 87% to RM32.7 million ($11 million) compared to RM246.3 million in 2Q17.
Revenue was 5% higher at RM133.2 million from RM126.7 million a year ago, due to higher contributions from project related revenue segments such as software licensing and software project services.
Cost of sales increased by 14% to RM57.8 million compared to RM50.7 million last year.
Hence, gross profit for the quarter came in at RM75.4 million, 1.0% lower than RM76.0 million in 2Q17.
Finance income was RM0.88 million, 69% higher than RM0.52 million a year ago.
Other income significantly dropped to RM1.10 million, compared to RM243.5 million last year, mainly due to the pre-tax gain of RM223.9 million from the disposal of 18.0 million shares in GIT and the accounting gain of RM18.8 million on dilution of interest in GIT in Q2 FY2017, following GIT's issuance of new shares as part consideration for its acquisition.
During the quarter, the group recorded share of loss of joint venture and associates of RM1.05 million, compared to a gain of RM3.0 million in the previous year, attributed to the group’s joint venture, Silverlake HGH, which recorded minimal losses in 2Q18 compared with some profit in 2Q17. No contribution was accounted for GIT in this quarter following the cessation of GIT as the group's associate.
The group is declaring a tax exempt second interim dividend of 0.3 cent per share and a special dividend of 0.8 cent per share. Total dividend amounts to 1.1 cents per share, which will be payable on March 8.
Raymond Kwong, managing director of Silverlake Axis says, “In our effort to return a portion of the gains to shareholders, the group has paid three special dividends from the GIT sale proceeds. In addition, the board is proposing a fourth special dividend with the 2Q18 results.”
Based on the current order book for projects and the group’s scheduled execution programme, it expects to record an improvement in project related software licensing and software project services revenue in the 1H18.
Shares in Silverlake Axis closed at 55 cents on Tuesday.
