Silverlake Axis 5CP has reported earnings of RM89.3 million ($25.2 million) for the 1HFY2024 ended Dec 31, 2023, an 11% decrease compared to its earnings of RM99.7 million in the corresponding period last year.
Revenue in the half-year period increased 1% y-o-y to RM397.4 million while cost of sales increased 9% y-o-y to RM177.2 million.
The company's total recurring revenue, which gives better earnings visibility and accounts for 75% of its overall revenue, increased 7% y-o-y to RM298.8 million.
Earnings per share stood at 3.52 sen in 1HFY2024.
Gross profit decreased 4% y-o-y to RM220.2 million for the period while gross profit margin (GPM) fell 3 percentage points to 55%.
In its outlook, the company notes that heightened macroeconomic volatility could mean that the banking industry reverts to being cautious, controlling operating costs and limiting budgets in IT and transformation. This has impacted the company’s sales cycle and will sustain pressure and compression in margins for FY2024.
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“Whilst the markets and customers we serve continue to remain robust and move with a positive momentum, this half year has been more challenging from a sales and delivery perspective. We are consistently monitoring the situation and adjusting our approach to bring tangible and relevant solutions at scale,” says group CEO Andrew Tan.
Separately, the company announced it has secured contracts to deliver innovative and transformative digital innovation enhancement solutions to 67 of its existing customers in 2HFY2024 ending June 30.
Silverlake Axis shares closed 0.5 cents lower or 2% down at 24.5 cents on Feb 15.
