Thursday, October 31, 2013

REDtone 1Q net profit rises to RM4.15m

REDtone 1Q net profit rises to RM4.15m

Thursday, 31 October 2013 11:23

KUALA LUMPUR: REDtone International Bhd saw its earnings for the first quarter ended Aug 31, 2013 (1QFY14) increase by 107.5% due to a significantly higher contribution from its data and broadband business.

Net profit for the quarter stood at RM4.15 million from RM2 million in the previous corresponding period.

Revenue for the quarter was also up 17.7% to RM36.11 million from RM30.67 million, driven by strong growth in its data segment.

The continued earnings uptrend in its latest quarter underscores REDtone’s success in turning its business around via repositioning itself in the data and broadband space.

REDtone CEO Lau Bik Soon said in a statement yesterday that the company has come a long way since 2009 when it embarked on a plan to return to profitability and to rebuild its business by focusing on the data segment and leveraging on its core competency.

“As a result of this, REDtone turned in a great year in FY13 [ended May 31] with a record net profit, and now a strong set of results for our latest quarter.

“Our data business is doing very well and gaining traction among our three key target markets — the corporate segment, SMEs/SMIs and the government sector. In 1QFY14, data revenue jumped 97.31% to RM22.43 million from RM11.37 million a year ago to take the lead as the major contributor to 1Q’s total revenue.

“Net profit from the data segment also grew substantially in 1QFY14, following a higher revenue from this business segment, compared to the preceding year. It contributed approximately 70% to RM4.15 million in 1QFY14,” he said.

Moving forward, REDtone will focus on building on the turnaround for continued strong earnings and sustainable growth.

According to Lau, REDtone will continue to look at its three core data target groups to increase its data business, and some of the initiatives that it has rolled out towards this end are a new data centre in Cyberjaya and its wholesale Ethernet deal with Telekom Malaysia Bhd (TM).

Its data centre in Cyberjaya offers high-end value-added solutions such as business continuity services, disaster recovery services, ICT as a service and professional advisory services to its customers.

Following the wholesale Ethernet deal it inked with TM in April this year, REDtone has widened coverage of its data and broadband services and signed up more corporate and SME/SMI customers.

REDtone shareholders will receive a dividend payout totalling RM7.58 million on Oct 31.

This is 30% of REDtone’s net profit for FY13, 5% more than its policy of distributing a minimum 25% to shareholders.

This article first appeared in The Edge Financial Daily, on October 31, 2013.

Publish date: 31/10/13

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