Inix hopes to turn around in FY16

SHAH ALAM: Loss making ICT solutions provider Inix Technologies Holdings Bhd is hopeful that it can return to the black for the financial year ending July 31, 2016 (FY16) following its diversification into the dredging and land reclamation services industry, according to executive director Mohd Anuar Mohd Hanadzlah.
“At the present scenario, I would say with RM900,000 profit guarantee (from the diversification), we will surely have a positive result. But we’re still working on the IT (division), (which is our) core business,” he told a press conference after the company’s AGM yesterday.
Earlier this month, Inix completed the acquisition of a 30% stake in Galactic Maritime (M) Sdn Bhd for RM7.2 million. The acquisition marks its entry into the dredging and land reclamation business.
The purchase comes with a total profit guarantee of RM2.1 million over 28 months, representing an average profit of RM900,000 per annum.
The profit guarantee works up to about 18% of the group’s total revenue of RM5 million for the last few years.
In November, Galactic clinched a RM34.5 million contract to provide three vessels for dredging and land reclamation works for a project in Penang.
The company is also handling two projects in Malacca with a total net book value of RM10 million. However, it is not bidding for any other projects currently.
Mohd Anuar foresees better prospects for the dredging and land reclamation business than its core IT business, which is involved in software development, system integration, IT management consultancy and other related professional services.
“From what we see, there are so many jobs related to ports, Pengerang and oil and gas. There are also not many big players in this area,” he explained.
Mohd Anuar said Inix has no intention to increase its shareholding in Galactic for the time being but will consider it with a more promising outlook for Galactic.
While acknowledging that the IT business is very tough and competitive, he stressed that the company will continue to try to secure more projects from government agencies, ministries and the financial sector for its payment gateway.
“We’re looking to supply software to the Ministry of Education and some other ministries. IT is all about trying to get projects,” he said.
Almost all of Inix’s projects are from the public sector, with margins of at least 30%.
Meanwhile, Mohd Anuar said the company is still in discussions to acquire mobile app players, without committing to a timeline of concluding a deal.
“We’re still negotiating, we’re trying to identify some companies that have developed mobile applications, it will be a short cut (for us to improve) our business,” he added.
Inix narrowed its net losses to RM44,000 for the financial year ended July 31, 2015 compared with a net loss of RM1.39 million a year ago, thanks to lower operation costs.
Inix Technologies’ shares closed unchanged at 7 sen yesterday. Some 1.2 million shares changed hands. Year-to-date the stock has fallen 58.82%.