Polaris Q4 net profit drops 67% to S$762,000

SINGAPORE - Electronics retailer Polaris has posted a 67 per cent drop in fourth-quarter net profit to S$762,000 from S$2.32 million in the year-ago period, the company announced on Monday (Feb 26) after markets closed.

This translated to an earnings per share of 0.0045 Singapore cents per share, from 0.014 Singapore cents last year.

For the full year, net profit fell 6 per cent to S$1 million in fiscal year 2017 compared to S$1.06 million in fiscal year 2016. The higher net profit in the previous year was mainly due to the recovery of the impairment of investment in associates in FY2016 of S$2.14 million, Polaris said.

No dividend has been declared for the current financial period, unchanged from the preceding year.

For the three months ended Dec 31, revenue fell 19 per cent to S$28.9 million from the previous year, while full-year turnover dropped 10 per cent to S$80.6 million from last year.

This was mainly due to lower revenue from the group's mobile handset and accessories distribution business for FY17, which decreased by 62 per cent to approximately S$12.96 million as compared to FY16, Polaris said.

For FY17, the group's administrative expenses decreased by 20 per cent to S$4.74 million. This was mainly attributable to lower staff and personal cost, and rental expense due to the closure of Sony and Lenovo retail outlets in FY16.

Similarly, finance costs fell 25 per cent to S$350,000, mostly due to repayment of the group's loan and borrowing in FY16, Polaris said.

Looking ahead, the group which also helps to distribute Singtel products, said that the addition of a fourth mobile operator in Singapore might have a negative impact its profitability.

"With the fourth mobile operator expected to join the market in 2018, all three existing operators are competing fiercely in the telco market," the company said. "Prices are being cut and new consumer plans and partner incentive schemes are being introduced. These changes might adversely affect the group's profitability."