VCI Global Limited has announced its audited financial results for the financial year ended December 31, 2023 (the “Financial Results”).
- VCI Global delivered a record-high total revenue of $19.8 million for the fiscal year 2023, representing a 145% YoY growth.
- Gross profit achieved significant growth of 159% YoY, reaching $16.4 million in fiscal year 2023.
- Net income reached $7.2 million in fiscal year 2023, achieving remarkable growth of 57%.
- VCI Global executed several major achievements that have led to a surge in revenue by expanding VCIG’s capital market consultancy and technology ventures.
- VCIG’s business strategy consultancy revenue surged by 265% yearly to $14.7 million in 2023, highlighting the potential of this industry.
- Additionally, VCIG demonstrates sustainable growth with a 13% revenue increase to $4.5 million in highly scalable technology development, solutions, and consultancy segment for fiscal year 2023, supported by a robust gross profit margin of 94%.
“We are excited to announce the exceptional financial performance, characterized by substantial growth in both revenue and profit. Our success underscores our steadfast commitment to excellence and the collective efforts of our dedicated team, as well as the strength of our business model and strategic initiatives on capital market consulting and technology business. As we look ahead, we remain focused on sustaining this momentum, delivering sustainable value to our shareholders, and making meaningful contributions to the communities we serve,” said Dato’ Victor Hoo, Group Executive Chairman and Chief Executive Officer of VCI Global.
FINANCIAL RESULTS
Revenue was $19.8 million for fiscal year 2023, representing an increase of 145% YoY from $8.1 million for fiscal year 2022. The increase in revenues was primarily attributable to higher demand across all of our business segments.
- VCIG’s revenue generated from business strategy consultancy fee increased by 265% to $14.7 million for fiscal year 2023, compared to $4.0 million for fiscal year 2022. The increase was primarily a result of the IPO services provided to 4 clients from Malaysia and Singapore. Notably, YY Group Holding Limited was successfully listed on the Nasdaq Capital Market on April 22, 2024, under the symbol “YYGH”. VCIG’s other clients are currently undergoing the process of going public on Nasdaq, further enhancing its reputation in this attractive market.
- The company’s revenue generated from technology development, solutions and consultancy increased by 13% to $4.5 million for fiscal year 2023, compared to $4.0 million for fiscal year 2022. This increase was primarily the result of completing two major projects: the development of a financing management system and an e-commerce platform, both provided to the Fintech industry.
- VCIG’s revenue generated from other services increased over six-fold to $0.7 million for fiscal year 2023, compared to $87 thousand for fiscal year 2022. In fiscal year 2023, the Company introduced a new service – financing service, which contributed revenue of $413 thousand.
| For the Fiscal Year Ended December 31 | ||||||
| 2023 | 2022 | Change | ||||
| USD | USD | % | ||||
| Revenue from Business Strategy Consultancy | 14,654,120 | 4,016,231 | 264.9 | % | ||
| Revenue from Technology Development, Solutions and Consultancy | 4,472,559 | 3,976,195 | 12.5 | % | ||
| Interest Income | 413,354 | – | 100.0 | % | ||
| Others | 244,715 | 87,047 | 181.1 | % | ||
| Total Revenue | 19,784,748 | 8,079,473 | 144.9 | % | ||
Other Income for fiscal year 2023 was $164 thousand, representing a decrease of 58%, compared to $393 thousand in fiscal year 2022.
EBITDA of $7.3 million in fiscal year 2023, reflecting a 37% margin of revenue, with a substantial increase of 125%, compared to $3.2 million in fiscal year 2022. This surge was primarily driven by heightened operating income.
Net Income for the fiscal year 2023 amounted to $7.2 million, representing a margin of revenue of 37% and a notable increase of 57%, compared to $4.6 million in fiscal year 2022.
Cost of Services was $3.4 million for the financial year ended December 31, 2023, representing a 93% increase from $1.7 million for the financial year ended December 31, 2022.
- Consultant fee costs increased by 464% to $2.4 million for the financial year ended December 31, 2023, compared to $428 thousand for the financial year ended December 31, 2022. This significant increase was primarily due to more ongoing IPO projects and the increase in their consultancy fees, driven by the Company’s engagement of more professionals including legal counsel, auditors, financial consultants, and US Capital Market consultants to serve its clients. Such consultant fee payment is included and treated as part of our consultation services to our clients during the IPO process.
- IT expenses decreased by 82% to $239 thousand for the financial year ended December 31, 2023, compared to $1.3 million for the financial year ended December 31, 2022. This significant reduction resulted from the expansion of the Company’s in-house IT team and the development and direct deployment of most IT projects to customers.
- The subscription fee was $31 thousand for the financial year ended December 31, 2023, compared to $3.2 thousand for the financial year ended December 31, 2022, due to an additional subscription to a service provider that provides media monitoring, analytics and insight solutions.
- Other costs of services increased by $661 thousand from $7 thousand in the fiscal year 2022 to $669 thousand in the fiscal year 2023. This increase was mainly due to the referral fees paid ($552 thousand) for introducing new projects for the consulting services.
| 2023 | 2022 | Change | ||||
| USD | USD | % | ||||
| Consultant Fee | 2,413,237 | 428,122 | 463.7 | % | ||
| IT Expenses | 239,426 | 1,300,252 | -81.6 | % | ||
| Subscription Fee | 30,720 | 3,208 | 857.5 | % | ||
| Referral Fee | 552,263 | – | 100.0 | % | ||
| Others | 116,503 | 7,404 | 1,473.4 | % | ||
| Total | 3,352,149 | 1,738,986 | 92.8 | % | ||
Depreciation expenses were $162 thousand in fiscal year 2023, representing an increase of 52%, compared to $106 thousand in fiscal year 2022. The increase was primarily due to additional assets acquired, including renovations for the newly leased offices and campus, as well as purchases of computer software and office equipment.
Directors’ fees increased by $1.2 million to $1.3 million for the financial year ended December 31, 2023, compared to $44 thousand for the financial year ended December 31, 2022. This increase was due to the increase in the number of Directors employed and their expanded responsibilities and duties toward the group after the successful IPO exercise on Nasdaq in April 2023.
Operating Income increased to $7.1 million in fiscal year 2023, reflecting a significant increase of 128% compared to $3.1 million in fiscal year 2022. This notable increase was primarily driven by the rise in revenue from Business Strategy Consultancy, resulting in a 265% increase due to the completion or near-completion of multiple IPO projects in fiscal year 2023.
Furthermore, revenue from Technology Development, Solutions and Consultancy witnessed an increase of 13% attributed to the completion of two major projects, namely fintech solutions and an e-commerce platform, alongside the addition of interest income derived from microfinancing activities.
As a result of the above, profit for the period was $7.2 million for the financial year ended December 31, 2023, compared to $4.6 million for the financial year ended December 31, 2022.
Basic and Diluted earnings per share was $0.21 for the financial year ended December 31, 2023, compared to $0.13 for the financial year ended December 31, 2022, reflecting an increase of $0.08, or 62%.
CASH POSITION AND CAPITAL ALLOCATION
Net cash generated from operating activities was $1.2 million in fiscal year 2023, a significant increase of $1.5 million, from -$0.3 million in fiscal year 2022, driven by a robust profit before tax of $7.1 million. This figure was adjusted for non-cash items and changes in operating assets and liabilities, mainly due to the increase in trade and other receivables of $0.1 million and an increase in trade and other payables of $3.7 million.
Net cash used in investing activities was -$4.0 million as of December 31, 2023, significantly decreasing from $256 thousand as of December 31, 2022. This decrease was attributable to VCIG’s investment in GlobexUS Holdings Corp., YY Group Holding Limited, and Sagtec Global Limited. Additionally, VCIG acquired property and equipment totalled $0.4 million.
Net cash generated from financing activities amounted to $3 million in fiscal year 2023, representing an increase of $2.7 million from $247 thousand in fiscal year 2022. The increase is mainly due to the advance payments to related parties and dividend payments of $0.5 million and $104 thousand respectively, as well as repayment of the operating lease of $82 thousand.
Cash and cash equivalents were recorded at $1.0 million as of December 31, 2023, representing a slight increase of 11 %, compared to the $0.9 million as of December 31, 2022. The amount includes cash on hand, general bank balances and cash in share trading accounts. Of the $1 million, $0.7 million is denominated in Ringgit Malaysia, while the rest is held in other currencies.
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