ICT Zone Asia Berhad Navigates Its First Quarter Post-Listing: A Look at Q1 FY2025 Performance
A new chapter has begun for ICT Zone Asia Berhad as it unveils its first interim financial report for the quarter ended 30 April 2025. This marks a significant milestone as the company prepares for its transfer of listing from the LEAP Market to the ACE Market of Bursa Malaysia Securities Berhad, expected on 3 June 2025. For Malaysian retail investors, this report offers a foundational glimpse into the company’s financial health and strategic direction as it steps onto a larger stage.
It’s important to note right from the start that as this is the company’s inaugural interim report in compliance with ACE Market Listing Requirements, there are no comparative figures available for the preceding year’s corresponding quarter (30 April 2024). Therefore, our analysis will focus on the current quarter’s performance and a comparison of the balance sheet against the immediate preceding financial year-end (31 January 2025).
Q1 FY2025: An Initial Financial Snapshot
For the first quarter, ICT Zone Asia Berhad has demonstrated a solid start, driven primarily by its core technology financing and ICT hardware/software trading segments. Let’s dive into the key numbers:
Overall Financial Performance
Q1 FY2025 (30 April 2025)
Revenue: RM41.62 million
Gross Profit: RM8.47 million
Gross Profit Margin: 20.35%
Profit Before Taxation: RM4.47 million
Profit After Tax (PAT): RM3.42 million
PAT Margin: 8.22%
Basic Earnings Per Share: 0.50 sen
Q1 FY2024 (30 April 2024)
Revenue: N/A
Gross Profit: N/A
Gross Profit Margin: N/A
Profit Before Taxation: N/A
Profit After Tax (PAT): N/A
PAT Margin: N/A
Basic Earnings Per Share: N/A
Note: No comparative figures are available for the preceding year’s corresponding quarter as this is the Company’s first interim financial report.
The Group achieved a revenue of RM41.62 million, predominantly from its technology financing and ICT hardware and software trading segments. This translated into a gross profit of RM8.47 million, yielding a healthy gross profit margin of 20.35%. Despite incurring approximately RM0.08 million in listing expenses during the quarter, the Group reported a respectable Profit After Tax (PAT) of RM3.42 million, with a PAT margin of 8.22%.
Business Segment Contributions
A closer look at revenue contributions reveals the Group’s primary drivers:
| Segment | Revenue (RM’000) | Contribution to Total Revenue |
|---|---|---|
| Technology financing | 21,883 | 52.58% |
| Trading of ICT hardware and software | 17,520 | 42.09% |
| Cloud solutions and services | 2,184 | 5.25% |
| Provision of ICT services | 33 | 0.08% |
| Total | 41,620 | 100% |
The Technology Financing segment clearly stands out as the largest contributor, accounting for over half of the Group’s revenue, underscoring its strategic importance.
Financial Health: Balance Sheet Snapshot
Comparing the Group’s financial position at the end of the quarter (30 April 2025) against the previous financial year-end (31 January 2025) provides insights into its stability:
As at 30 April 2025
Total Assets: RM229.495 million
Total Equity: RM73.765 million
Total Liabilities: RM155.730 million
Cash and Bank Balances: RM15.054 million
Net Assets per Share: RM0.11
As at 31 January 2025 (Audited)
Total Assets: RM236.547 million
Total Equity: RM70.343 million
Total Liabilities: RM166.204 million
Cash and Bank Balances: RM13.962 million
Net Assets per Share: RM0.11
While total assets saw a slight decrease, total equity increased from RM70.343 million to RM73.765 million, indicating a strengthening of the ownership base. Importantly, the Group’s cash and bank balances improved from RM13.962 million to RM15.054 million, reflecting effective cash management. Net assets per share remained stable at RM0.11.
Cash Flow Performance
The cash flow statement reveals healthy operational cash generation, with RM5.804 million generated from operating activities. However, significant investing activities, including RM6.744 million for the acquisition of property, plant, and equipment, resulted in a net cash outflow from investing activities. Financing activities saw a net inflow of RM1.301 million, contributing to a net increase in cash and cash equivalents of RM1.093 million for the quarter.
Risks and Prospects: Charting the Future
ICT Zone Asia Berhad remains cautiously optimistic about its future performance, buoyed by several strategic tailwinds and initiatives:
- Demand for Subscription-Based ICT: The Group is well-positioned to capitalize on the increasing demand for subscription-based ICT procurement across both public and private sectors, aligning with the ongoing shift from capital expenditure (CapEx) to operating expenditure (OpEx) models.
- Leveraging IPO Proceeds: The upcoming IPO is set to raise RM26.60 million in gross proceeds from the public issue. A substantial RM21.00 million is earmarked for purchasing new ICT hardware and software, which is expected to significantly expand the Group’s capacity to secure additional long-term contracts and boost its unbilled order book.
- Circular Economy Strategy: The Group’s commitment to remarketing and renting refurbished ICT assets after their initial financing lifecycle extends asset life, optimizes capital efficiency, and caters to budget-sensitive clients, fostering a sustainable business model.
- Strategic Partnerships: A Memorandum of Understanding (MoU) with Malaysia Digital Economy Corporation (MDEC) under the Business Digitalisation Initiative (BDI) is anticipated to unlock new contract opportunities and enhance market penetration, particularly in the private sector.
- Capitalizing on AI and Windows 10 End-of-Support: The Group is strategically positioned to benefit from Malaysia’s accelerating AI adoption and the impending end-of-support for Windows 10 in 2025. This drives demand for AI-capable devices and enterprise upgrades, aligning with the Group’s Everything-as-a-Service (XaaS) offerings.
The Group’s unbilled order book for its technology financing segment stands at an impressive RM253.42 million over the next five financial years, while the cloud solutions and services segment has an unbilled order book of approximately RM5.55 million for the same period. These figures provide a strong indication of future revenue visibility.
Summary and Outlook
ICT Zone Asia Berhad’s first quarterly report post-IPO (transfer to ACE Market) paints a picture of a company with a clear strategic vision and a promising start to its financial year. Despite the lack of comparative historical data for the same quarter last year, the reported revenue and profitability for Q1 FY2025 are encouraging. The Group’s focus on technology financing, its circular economy initiatives, and its strategic positioning to capitalize on digital transformation trends, including AI adoption, appear to be solid foundations for future growth.
Key highlights from this report include:
- A robust first quarter performance with RM41.62 million in revenue and RM3.42 million in PAT.
- Strong contributions from the technology financing segment, which is a key driver of growth.
- A healthy unbilled order book, providing significant revenue visibility for the next five years.
- Strategic initiatives aimed at expanding market reach and leveraging industry trends like AI and subscription-based models.
- A strengthened cash position, indicating sound financial management.
As the company prepares for its listing on the ACE Market, it is clearly laying the groundwork for sustained growth by investing in its core business and adapting to evolving market demands. The IPO proceeds are strategically allocated to further expand its technology financing capabilities, which should reinforce its position as a key player in Malaysia’s ICT landscape.
From a professional standpoint, the consistent focus on recurring revenue models through technology financing and cloud solutions positions ICT Zone Asia Berhad favorably in a dynamic market. The emphasis on a circular economy strategy not only aligns with global sustainability trends but also provides a cost-effective way to expand its customer base. The upcoming ACE Market listing and the fresh capital injection from the IPO are critical catalysts for executing these ambitious growth plans.
Do you think ICT Zone Asia Berhad can maintain this growth momentum and successfully execute its strategic initiatives as it transitions to the ACE Market? Share your thoughts in the comments below!
