Nexgram posts first quarter loss due to disposal of units
PETALING JAYA: Nexgram Holdings Bhd swung to the red, posting a net loss of RM2.3mil for the first quarter ended Oct 31, 2016, from a net profit of RM3.9mil in the same quarter a year ago on increased losses incurred from the disposal of subsidiaries involved in information technology (IT) during the quarter.
Revenue dropped 56.7% to RM13.43mil mainly due to lower revenue from the IT subsidiaries, as well as subsidiaries in the security and video surveillance equipment business.
Loss per share was 12 sen from 21 sen previously.
The company told the exchange that changes across the IT and telecommunications industries had impacted performance.
In view of the uncertainties and challenges ahead, the company expects to continue and focus on the development and future growth of the existing businesses.
Nexgram shares closed unchanged yesterday at four sen, with 8.68 million shares traded.
It had also diversified into property development via unit Nexgram Land Sdn Bhd. Nexgram Land entered into an off-take agreement-cum-sales and purchase agreement with Myangkasa Bina Sdn Bhd, wholly-owned by Angkatan Koperasi Kebangsaan Malaysia Bhd.
“The property development project involves residential development of two blocks of a 35-storey building on 5.3 acres of commercial land, and a mixed commercial development comprising of an office building and Soho, retail shops and high-end apartment suites on a 5.9-acre plot of commercial land,” said Nexgram, adding that the parcels of land for development were located in Putrajaya and Cyberjaya. With completion slated for 2020, both the projects have an estimated gross development value of RM1.45bil.
In line with its ongoing business-rationalisation plan, Nexgram disposed of dormant subsidiaries that contributed losses in the past years.
Nexgram’s new source of recurring income will come from newly acquired Transeaways Shipping Sdn Bhd and Blue Hill Development Sdn Bhd. This will be part of the company’s long-term growth strategy to venture beyond the ICT and property businesses.