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Nera posts 33% fall in Q1 profit

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NERA Telecommunications, a mainboard-listed company in the business of telecommunications and infocomm, on Wednesday posted profit after tax for the first quarter ended March 31, 2016, of S$2.03 million, marking a 33.4 per cent decrease from S$3.05 million a year ago.

NERA Telecommunications, a mainboard-listed company in the business of telecommunications and infocomm, on Wednesday posted profit after tax for the first quarter ended March 31, 2016, of S$2.03 million, marking a 33.4 per cent decrease from S$3.05 million a year ago.

Revenue saw an 11 per cent fall from S$42.1 million in Q1 2015 to S$37.5 million in Q1 2016, a result of lower turnover from the infocomm segment, partially offset by higher turnover from the telecommunications segment.

Turnover from the infocomm segment fell by 24.4 per cent (S$8.3 million), from S$34.0 million in Q1 2015 to S$25.7 million in Q1 2016, mainly from lower sales of network equipment to the service provider market sector and lower sales revenue from point-of-sales terminals in Thailand.

Earnings per share fell to 0.56 Singapore cent in Q1 2016, from 0.84 Singapore cent a year ago. No dividend has been declared for the period.

In Q1 2016, Nera secured a total of about S$70.2 million in order intake, an increase of 21.9 per cent compared with S$57.6 million in Q1 2015, driven by significant orders received from the infocomm segment.

While competition in the network infrastructure business remains "high and fragmented" with many local system integrators partnering global network equipment vendors to offer networking products and services, demand for network infrastructure products, solutions and services will continue, due to a rapid increase in Internet traffic and services, data, video content and security threats.

The group added that it will focus on providing IP, optical, broadcast, cloud, data centre and security network infrastructure products and solutions to three main targeted verticals, namely service providers, enterprises and government, transport and utilities.