Silverlake Axis posts 51% fall in Q3 net profit to RM25.6m

BUSINESS software company Silverlake Axis saw its third-quarter earnings more than halved mainly due to lower other income and higher expenses.

For the three months ended March 31, net profit fell 51 per cent to RM25.6 million (S$8.4 million) from RM52.6 million a year ago.

Earnings per share for the quarter came in at 0.97 sen from 1.99 sen in the preceding year.

This came as other income sank 89 per cent to RM2.3 million from RM20.5 million in the previous year. In Q3 2019, there was a RM18.2 million gain from the reversal of value-added tax (VAT) accrued, as the group obtained VAT exemption for the prior disposal of shares in Global InfoTech Co.

Revenue for the quarter slipped 2 per cent to RM151.7 million from RM154.1 million a year earlier. This was mainly due to lower contribution from project-related revenue segments and the sale of software and hardware products which is cyclical, Silverlake said.

Meanwhile, income tax expense rose 36 per cent to RM11.3 million for the quarter. This was attributable to the expiry of pioneer status of a Malaysian subsidiary effective Q1 FY20, higher taxable income from certain subsidiaries, as well as higher withholding tax on overseas revenue in the current financial period, as compared to the previous corresponding period, the company noted.

Shares of Silverlake closed at 25 Singapore cents on Thursday, down 0.5 cent or 2 per cent.