Scicom aims to penetrate new markets in the region

Emerging markets have a large scale of training and business outsourcing needs Emerging markets have a large scale of training and business outsourcing needs

PETALING JAYA: Business outsourcing company Scicom (MSC) Bhd, whose share price has soared 190% year-to-date, is aiming to penetrate new markets in the region.

“Emerging markets have a large scale of training and business outsourcing needs, which we intend to capitalise on as we have the capability to train a few thousand people at a time,” group chief executive officer Leo Ariyanayakam told reporters after the company’s EGM and AGM yesterday.

“We are at our sweetest spot now, where we have the scale, money and experience in business outsourcing to take advantage of the large-scale needs of emerging-market goverments and corporations,’’ he said.

For its first quarter ended Sept 30, Scicom’s net profit jumped 38% to RM7.2mil on the back of RM43.5mil in revenue, which reflects a 17.5% growth over the corresponding quarter of last year.

It said the growth would be sustainable for the rest of the year, buoyed by the outsourcing business continuing its growth momentum with a 18.36% and 28.9% growth rate year-on-year for revenue and direct contribution, respectively.

“The increase in outsourcing’s revenue and direct contribution is attributable to organic growth in existing projects,” said the company in its filing with the stock exchange yesterday.

The company also announced a tax-exempt interim dividend of 1.5 sen per share for the current financial year, payable on Dec 15. Last financial year, the company rewarded its shareholders with almost a 90% payout ratio of total profit, amounting to total interim dividend of seven sen per share. Scicom’s all-time high net profit last year grew more than 50% to RM22.4mil.

The zero-debt company has cash balances of more than RM26mil.

The group’s outsourcing business principally comprises services provided to clients on long-term contracts. Additionally, clients require the group to provide ad hoc short-term services.

Scicom currently has four core businesses, namely, customer contact management solutions, education solutions, government services and e-commerce services.

Outsourcing services comprise business process outsourcing services, which offer multi-lingual, multi-channel customer care, technical support help desks, consultative sales and associated fulfillment.

Training and consultancy includes educational and industrial training services primarily focused on customer care in the services industry.

Geographically, Scicom has call-centre operations in Sri Lanka and Indonesia, besides Malaysia.

Scicom was in the headlines recently as it was one of the companies that had inked a memorandum of understanding (MoU) with Khazanah Nasional Bhd and ailing Malaysia Airlines (MAS) to provide 3,500 jobs for MAS employees who would be retrenched.

MAS’ majority shareholder Khazanah in September had announced that 6,000 of the airline’s 20,000 staff would be laid off.

However, Ariyanayakam was unable to comment further on the timelime of the MoU.

“We have tendered in several proposals, but it is a bit premature to reveal the location and details of these prosposals. We will do so in due course,” he said.

All the resolutions were passed at the AGM and EGM yesterday.

The EGM was called to seek shareholders’ approval for the company’s proposed bonus issue of 59.2 million new shares on the basis of one bonus share for every five shares held.

Scicom closed four sen higher at RM2 yesterday.