Nextnation: Weak Q1 result

As expected, nX posted a very weak Q1 result. Below is the article from The Edge:


KUALA LUMPUR: Nextnation Communication Bhd’s net profit for its first quarter (1Q) ended July 31, 2007 fell sharply to RM611,000 from RM4.8 million a year ago mainly due to the rising operating costs for its wider geographical regions participation coupled with the higher technical expenses incurred from its restructuring process.

In an announcement yesterday, the company said its revenue was 24.1% lower at RM17.79 million against RM23.45 million a year earlier because of the delay in business transactions and projects as a result of the on-going restructuring process. Its basic earnings per share was 0.16 sen.

Going forward, Nextnation said the group would continue to focus on its technology, products development, service enhancement, market expansion, and maintaining strategic partnerships.

“The board expects increasing positive contribution from the group’s overseas operations in order to support business expansion,” it said, adding that the board expects a satisfactory performance for the remaining financial year barring any unforeseen circumstances.

Comment: I am wondering how long do they need for the restructuring? Once again, if it is well managed, restructuring should not be the reason for the extremely weak result. I also wonder what excuse they will use for the coming quarter. Restructure for a few years?