KUALA LUMPUR (May 5): ECS ICT Bhd, a distributor of information and communication technology (ICT) products, registered a 45.45% drop in its net profit for the first quarter ended March 31, 2016 (1QFY16) to RM5.12 million or 2.8 sen per share from RM9.39 million or 5.2 sen per share due to higher sales last year from the run-up to the goods and services tax (GST) implementation.

ECS ICT's revenue in 1QFY16 came to RM434.72 million, which was 16.86% lower than the previous corresponding quarter's RM522.86 million.

Apart from lower revenue, ECS ICT said the pre-tax profit of its ICT distribution business, the group's biggest revenue and profit contributor, fell by 43.2% because of higher operating cost of RM4.6 million.

"Although the ringgit has strengthened against the US dollar in the first quarter of 2016, the overall economic uncertainty continues to dampen market sentiments on spending for consumer ICT products and enterprise systems," said the firm of its prospects.

Citing International Data Corp's report on ICT spending for Malaysia in 2016, the market research firm forecasts the spending on hardware and software to grow by a marginal 3%, while smartphones, 7%.

"In light of the above, we are increasing our focus on mobility products by introducing new products to expand our mobility channel and market reach," ECS ICT said.

It concluded by saying it was positive on its outlook for the remainder of FY16, hinged on its expansion plans on mobility and wearable products.

ECS ICT shares were not traded today. Its last closing price of RM1.65 valued the company at RM297 million.