IT firm Elsoft expects to end financial year with record high shipments

GEORGE TOWN: Elsoft Research Bhd expects to end the 2018 financial year with record high shipments of test equipment that will impact positively its revenue and profit.

Group chief executive officer C.E. Tan told StarBiz that in the group’s second half order book there were orders for over 30 test equipment that would be delivered before the end of December.

“Based on today’s market price of RM1mil per unit, the test equipment is worth more than RM30mil in the market.

“More orders are still coming. We accept orders until October, as the time needed to assemble a test equipment is between 10 weeks and 16 weeks, depending on whether it was a repeat order or for a new equipment.

“In the first half of 2018, the group had already delivered over 40 units of test equipment.

“Last year, the group shipped out about 60 units of test equipment worth about RM60mil,” Tan said.

About 60% of the orders come from the smart device segment for 2018, while the other 40% from the automotive sector.

Tan said the group’s was able to achieve record breaking results for its revenue and profit this year, as the volume of test-equipment shipment for 2018 will be a record high.

Moving forward, Tan said the group could expect its customers in China to shift the production of their LED components to Malaysia.

“In the long run, this could translate into more orders for our test equipment,” he added.

On the smart device segment, the group would see earnings growth from advancement in the smart devices market.

“The group is also exploring new opportunity in the automated test equipment for infrared and laser devices, following through previous diversification strategies into the solar cells and medical markets.

“The group is making efforts to reduce dependency on its existing market sectors,” he said.

Tan added that Elsoft aspired to be the world leading one-stop automated test equipment solution provider across existing and new industry sectors.

“Diversity in high value products and services will allow Elsoft to increase competitiveness and returns.

“With solid fundamentals and a healthy financial standing, the group is confident it will be able to take advantage of growth opportunities,” he said.

Leso Corp Sdn Bhd, a 30% owned associate company, which is involved in the trading of industrial electronic and medical electronic products, will continue its business expansion plan into overseas market while Malaysia market will still remain a key focus in year 2018, according to Tan.

Butterfly House (PG) Sdn Bhd, a 21.16% owned associate company, will explore opportunities in consultancy services in other countries and education programmes while focusing on operational cost reduction.