KUALA LUMPUR (Aug 16): Dagang NeXchange Bhd (DNex) said second quarter net profit rose nearly 23-fold to RM89.5 million, from RM3.91 million a year ago, thanks to the inclusion of the RM85.3 million share of profit from its 30% associate company, Ping Petroleum Ltd.

Revenue for the quarter ended June 30, 2016 (2QFY16) more than doubled to RM47.4 million, from RM22.6 million in 2QFY15, helped by progressive billing to the transport ministry on the Vehicle Entry Permit and Road Charges (VEP & RC) system project.

For the first half of financial year 2016 (1HFY16), net profit jumped by more than 20 times to RM94.9 million, from RM4.38 million in 1HFY15, while revenue rose 66.7% to RM74.3 million, from RM44.6 million.

In a media release, the group said e-commerce services for trade facilitation continued to be the main contributor to its revenue.

DNeX RFID Sdn Bhd, a 51%-owned subsidiary of the group, was awarded a total subcontract of entire works to implement the VEP & RC system project for the transport ministry on Nov 16, 2015.

The contract, worth about RM45.2 million, involves the supply and installation of relevant IT and non-IT hardware, application system development, software, as well as networking,” it said.

Commenting on the group’s results, DNex managing director Zainal Abidin Jalil said: “The strong financial performance is evident that DNex has been making the right moves and investments in moving the group forward.”

He said DNex is consistently hitting key milestones in its diversification into energy, while at the same time, strengthening its leadership in providing e-commerce services for trade facilitation, and implementation of IT to boost efficiency of business processes of companies and organisations.

“Despite the current oil price environment, we are pleased to highlight that the Anasuria cluster asset in the North Sea, UK, held by Ping, is generating positive cash flow. The recent completion of the OGPC Group acquisition will also contribute positively to the group’s energy sector earnings.

“We have completed the strategic transformation of DNex into a two core business, namely energy, and IT and e-commerce services. Today, we see ourselves as an entrepreneur-driven company with an asset light, knowhow-intensive business approach,” he added.

DNex’s share price closed unchanged at 22.5 sen today. At its current level, the company has a trailing P/E ratio of 11.3 times, with a market capitalisation of RM279.1 million.