KUALA LUMPUR (Sept 25): SNS Network Technology Bhd's (KL:SNS) net profit fell 29.7% year-on-year (y-o-y) in the second quarter ended July 31, 2024 (2QFY2025), dragged down by lower revenue alongside higher selling and distribution costs, which were driven by increased salaries, commissions to third-party online marketplaces, and higher marketing expenses.

Net profit for the three months came in lower at RM6.35 million from RM9.02 million in 2QFY2024. Consequently, earnings per share decreased to 0.39 sen from 0.56 sen, as shown in the Ipoh-based information and communications technology (ICT) systems expert's bourse filing.

Revenue also declined 8.8% y-o-y to RM303.7 million from RM332.9 million, mainly because the group secured major orders to supply laptops for the education industry through commercial channels in the previous corresponding financial quarter.

Nevertheless, SNS Network proposed a single-tier second interim dividend of 0.25 sen per share, totalling RM4.05 million, payable on Nov 26.

On a quarter-on-quarter basis, SNS Network’s net profit was 69.6% higher compared to RM3.74 million recorded in 1QFY2025, resulting from an increase in commercial orders and lower staff commissions during the period. Revenue rose 42.2% from RM213.59 million.

For the cumulative six-month period (6MFY2024), the group's net profit fell 40.3% y-o-y to RM10.1 million from RM16.9 million, while revenue dropped 16.9% y-o-y to RM517.3 million from RM622.7 million.

As of the end of July, the group's fixed deposits, cash, and bank balances stood at RM91.7 million.

Looking ahead, SNS Network plans to open 10 new stores across the nation, including one launched in Penang in May and another in Selangor in October, to expand its customer base.

The group is also focusing on expanding its device-as-a-service (DaaS) offerings while embracing emerging technologies, particularly artificial intelligence.

In a separate statement, SNS Network's managing director Ko Yun Hung said the company remains optimistic about its industry prospects due to the ongoing data centre boom, which is driving construction and infrastructure development in the sector.

The group plans to capitalise on this opportunity, supported by a strong balance sheet and extensive offerings for various clients, according to Ko.

“SNS Network will continue to expand its commercial presence, including overseas, while remaining prudent in managing costs and finances to navigate uncertainties in the global market,” he added.

SNS Network's shares settled one sen or 1.6% lower at 63 sen on Wednesday, valuing the company at RM1.02 billion. Year to date, the stock is up more than two times.