KUALA LUMPUR (Nov 27): Digital media and advertising company Catcha Digital Bhd (KL:CATCHA) said on Wednesday that it will continue to focus on organic expansion and strategic mergers and acquisitions (M&As) to sustain its earnings growth.
Catcha Digital group chief executive officer Eric Tan Leong Yit said that the group has seen a consistent annual organic growth of up to 25% across all of its businesses, which will continue to support the group’s earnings growth in the upcoming years.
“You can expect organic growth from our existing portfolio companies, and on top of that, we would leverage on M&A to really grow even further than that,” Tan said during a virtual investor briefing following its third-quarter earnings.
Tan previously told The Edge in a recent interview that the group is actively on the lookout for earnings-accretive M&As, with an allocation of about RM80 million over the next 24 months.
“I wouldn't say we would need further acquisition to sustain the growth level, but I would say we would need further acquisitions to really supercharge our business,” he explained at the briefing.
Tan shared that there will be more acquisitions in the pipeline soon, which will be supported by the company’s internal cash, bank facilities, as well as private placement exercise.
As at Sept 30, 2024, its cash and cash equivalent stood at RM4.98 million.
iMedia Asia Sdn Bhd, which was acquired by Catcha Digital back in 2011, has now become its main earnings contributor, as it operates 13 high-traffic digital media publishers, including Goody, Oh! Media, Kimchi Daily, Beautiful Nara, Moretify, Weirdkaya, and The Reporter.
Tan reiterated that the ACE Market-listed company has set its sight on achieving double-digit growth for both its top- and bottom lines.
“I would say this is our target. We are not in a position to commit, but it is a target that we have every single year, to make sure we grow top and bottom line in the double digit manner,” he added.
3Q net profit surges to near seven-year high
Catcha Digital announced its third-quarter earnings on Wednesday, which saw the group recorded the highest net profit over the last nearly seven years, and a record revenue since it was listed on Bursa Malaysia in July 2011.
Net profit for the three months ended Sept 30, 2024 (3QFY2024) more than tripled to RM1.23 million, from RM326,000 in the same quarter a year ago, mainly driven by its online media business. Quarterly revenue jumped 55% to RM11.14 million, compared with RM7.19 million last year.
For the first nine months (9MFY2024), net profit more than doubled to RM3.40 million versus RM1.36 million in the same period a year earlier, as revenue rose 61.4% to RM27.55 million, from RM17.07 million.
Catcha Digital exited Guidance Note 2 (GN2) status in July 2023, after completing its regularisation plan. The company slipped into the GN2 status in August 2017, following the sale of its then digital asset Rev Asia Holdings Sdn Bhd to Media Prima Bhd (KL:MEDIA) for RM105 million.
Shares of Catcha Digital closed 1 sen higher, or 3.03%, to 34 sen on Wednesday, valuing the group at RM122.87 million.