Aztech Global H1 profits more than double to S$29.4 million as tech market heats up

MAINBOARD-LISTED tech dealer Aztech Global's earnings surged in the first half as customer orders drove up sales volume in the smart devices market.

Net profit more than doubled to S$29.4 million for the six months to June 30, from S$13 million in the year-ago period, according to unaudited results released on Friday.

Revenue rose to S$249.7 million, up by 93.4 per cent from S$129.1 million before, which Aztech attributed to demand for Internet of Things (IoT) devices and data communication products. Most of the turnover was from the distribution and trading business.

The latest revenue growth came "despite the Covid-19 pandemic affecting the group's operations in People's Republic of China and Malaysia", Aztech noted in its financial statements. Singapore-based Aztech has research and development facilities in Singapore, Hong Kong and mainland China, as well as manufacturing plants in China and Malaysia.

Earnings per share stood at 4.12 Singapore cents for the half-year. That was up from 2.10 cents previously, based on the share capital before Aztech's listing in March. Meanwhile, net asset value was S$0.32 a share, against S$0.07 as at Dec 31, 2020.

While Aztech plans to keep growing the IoT and data communication business, it added that it intends to secure new orders in the consumer, industrial and health technology sectors.

Citing the rosy prospects for the IoT and data communication industries, Aztech also said it "remains cautiously optimistic of its prospects in 2021".

Aztech chairman and chief executive Michael Mun added in a statement: "In spite of the challenges, the group remains committed to growing its footprint in tandem with the growth in the IoT and data communication space."

The order book was S$530.4 million as at July 1, with most of these orders expected to be completed in 2021, barring supply-chain or other constraints.

This comes even as Aztech also noted that a global parts shortage "is unlikely to abate in the next six to 12 months".

No interim dividend was recommended for the period, with Aztech saying that it "intends to conserve cash and recommend dividend payment annually". The group earlier paid out cash dividends of S$2.65 a share, and cash or scrip dividend of S$0.02 apiece.

Aztech added S$0.01 or 0.79 per cent, at S$1.27, before the results were released.