Technology company CSE Global has posted a 22.5 per cent drop in fourth-quarter earnings to $8.1 million as revenue slid amid the challenging business environment.
Revenue from continuing operations for the three months to Dec 31 last year fell 14.6 per cent to $98.8 million, despite gross margins rising 4.4 per cent to 31.1 per cent.
Net profit for the full year fell 3.7 per cent to $34.1 million, while revenue dipped 1.1 per cent to $412 million. The lower bottom line was driven mainly by lower revenues in the Australia region, though partially offset by higher revenues recognised in the Americas, Europe, the Middle East and Africa, said the group yesterday.
Gross margins were "relatively stable" at 28.7 per cent, thanks to a "better sales mix of brownfield jobs which carry higher gross margins".
But operating expenses rose 4.8 per cent to $78.2 million, on the back of $1.6 million drawn for the newly-acquired Crosscom business and higher provisions for doubtful debts of $1.7 million.
AT A GLANCE
NET PROFIT: $8.1 million (-22.5%)
REVENUE: $98.8 million (-14.6%)
FINAL + SPECIAL DIVIDENDS: 1.5 cents per share (Unchanged)
CSE Global said it generated a strong positive operating cash flow of $45.1 million during the quarter, allowing it to end the year with a net cash position of $54.2 million - a significant improvement from the $23.4 million previously.
Chief financial officer Eddie Foo noted that the group achieved several delivery milestones for its projects, which contributed to the higher billings and collections, and bolstered its cash position.
"The group's current financial position puts us in a good position to seize the growth opportunities going forward," he said.
Earnings per share for the quarter was 1.56 cents, down from 2.01 cents before. Net asset value per share was 46.77 cents as at Dec 31, up from 40.73 cents as at the same time the year before.
The board has recommended a final dividend of 1.25 cents per share, and a special dividend of 0.25 cent.
Group managing director Lim Boon Kheng said: "Despite challenging operating conditions in the past year, our resilient business model has enabled us to deliver a set of sound financial results."
The outlook remains sluggish as the group continues to see "a lack of large greenfield projects amid the challenging global economic outlook and low commodity prices".
But Mr Lim said there will be "pockets of opportunities" for CSE Global this year, adding that the overall businesses of its major subsidiaries "should remain resilient".
CSE Global shares closed flat at 42 cents yesterday, before the results were released.