VCI Global Gives Full Year Guidance After Seeing Revenues Increase Over 145% in 2023

Rhea-AI Summary

VCI Global (NASDAQ: VCIG) reported a stellar financial performance for 2023, with revenues soaring by 145% to $19.8 million. Gross profit surged by 159% to $16.4 million, and net income rose by 57% to $7.2 million. The company's business strategy consultancy revenue increased by 265% to $14.7 million. In its technology development segment, revenue grew by 13% to $4.5 million with a gross profit margin of 94%. Based on these results, VCIG has raised its fiscal 2024 outlook, expecting net sales to increase by approximately 65%, with operating income projected to grow between 20% and 23%.

Positive

• Revenue for 2023 reached $19.8 million, a 145% YoY increase.
• Gross profit rose by 159% to $16.4 million in 2023.
• Net income grew by 57% to $7.2 million.
• Business strategy consultancy revenue surged by 265% to $14.7 million.
• Technology development segment revenue increased by 13% to $4.5 million.
• Gross profit margin in the technology segment was 94%.
• Fiscal 2024 outlook predicts a 65% increase in net sales.
• Operating income for 2024 is projected to grow between 20% and 23%.

Negative

• Operating expenses for 2024 are projected to be approximately $18.8 million, a significant increase from the adjusted $9.5 million in 2023.
• The effective tax rate for 2024 is expected to be approximately 5%, up from zero in 2023.
• The PR acknowledges an uncertain consumer and macro environment which could impact future performance.

Insights

Financial Analyst

VCI Global's announcement of a 145% year-over-year revenue increase to $19.8 million for fiscal year 2023 is a significant milestone. The growth in gross profit, which has increased by 159% to $16.4 million, indicates that the company has managed to scale its operations efficiently while maintaining a robust margin. Additionally, the net income growth of 57% to $7.2 million is promising, albeit the growth rate is lower compared to the revenue and gross profit increases.

The fiscal 2024 outlook predicting a 65% increase in net sales and an operating income growth range of 20%-23% suggests continued strong performance. However, the operating expenses are expected to nearly double, indicating that the company might be heavily investing in expansion and technology development. While this could yield long-term benefits, it poses some short-term risks to profitability. The company’s effective tax rate of 5% is relatively low, which could be advantageous in maximizing net income.

Retail investors should note the impressive growth in VCIG’s business strategy consultancy revenue by 265% to $14.7 million, highlighting the potential and success of this segment. The technology development segment also shows promise with a 13% revenue increase and a robust gross profit margin of 94%, suggesting high scalability and profitability in this area.

In summary, while the results are impressive, investors should remain cautious about the significant increase in operating expenses and the uncertain macroeconomic environment mentioned by the company.

Market Research Analyst

The exceptional growth in VCI Global's consulting revenue, particularly in business strategy consultancy, reflects a strong demand for their expertise in capital markets and technology ventures. The firm’s ability to expand significantly in these areas suggests a positive market reception to their services. Additionally, the sustained growth in their technology development segment, coupled with high gross profit margins, indicates effective cost management and a scalable business model.

VCI Global's diversified focus across fintech, AI, robotics and cybersecurity aligns well with current market trends and investor interests, adding a layer of resilience to their business model. The company’s performance in 2023 sets a strong foundation for 2024, but the market conditions and consumer environment remain unpredictable, which could impact the expected growth.

Overall, the strategic expansion in high-potential areas and maintaining a diversified portfolio positions VCIG well for future growth, but investors should monitor how these strategies play out in the context of broader economic conditions.

KUALA LUMPUR, Malaysia, June 03, 2024 (GLOBE NEWSWIRE) -- VCI Global Limited (NASDAQ: VCIG) (“VCI Global”, “VCIG”, or the “Company”), a diversified holding company focusing on consulting and technology, announces revenue guidance for the fiscal year of 2024.

"VCI Global delivered a strong financial year that exceeded expectations across key metrics. We gained market share with positive comparable sales demonstrating improved relevance with our business model. The milestone that we have executed so far this year has given us confidence to raise both sales and operating income guidance for the full year. We are on a journey to become a high-performing company in every phase of our business," said Victor Hoo, Executive Chairman and Chief Executive Officer of VCI Global.

2023 Financial Highlights

• VCI Global delivered a record high total revenue of $19.8 million for 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, achieved 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%.

Fiscal 2024 Outlook

As a result of its strong 2023-year-end results, VCIG is currently giving its outlook for fiscal 2024, reflecting higher net sales and meaningfully higher operating income growth compared to its prior expectations. This outlook takes into consideration the continued uncertain consumer and macro environment.

Full Year Fiscal 2024

	Current FY2024 Outlook		FY2023 Results
Net Sales	Approximately increased by 65% on a 52-week basis		$19,784,748
Gross Margin	Approximately 85%		83%
Operating Expense	Approximately $18.8m		$9,494,027 (adjusted)
Operating Income	20% - 23% growth range		$7,105,486 (adjusted)
Effective Tax Rate	Approximately 5%		Nil

About VCI Global Limited

VCI Global is a diversified holding company. Through its subsidiaries, it focuses on consulting, fintech, AI, robotics, cybersecurity, and gamification. Based in Kuala Lumpur, Malaysia, our main operations are centered in Asia, with significant visibility across Asia Pacific, the United States, Europe, and the Middle East. VCIG primarily offers consulting services in capital markets, real estate, AI, and technology. In technology businesses, the company operates a proprietary financing platform that serves companies and individuals, as well as a secured messaging platform serving governments and organizations. We also invest, incubate, accelerate, and commercialize businesses and technologies in AI, robotics, and gamification.

For more information on the Company, please log on to https://v-capital.co/. 

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements that are subject to various risks and uncertainties. Such statements include statements regarding the Company’s ability to grow its business and other statements that are not historical facts, including statements which may be accompanied by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential” or similar words. Actual results could differ materially from those described in these forward-looking statements due to certain factors, including without limitation, the Company’s ability to achieve profitable operations, customer acceptance of new products, the effects of the spread of Coronavirus (COVID-19) and future measures taken by authorities in the countries wherein the Company has supply chain partners, the demand for the Company’s products and the Company’s customers’ economic condition, the impact of competitive products and pricing, successfully managing and, general economic conditions and other risk factors detailed in the Company’s filings with the United States Securities and Exchange Commission (SEC). The forward-looking statements contained in this press release are made as of the date of this press release, and the Company does not undertake any responsibility to update the forward-looking statements in this release, except in accordance with applicable law.

CONTACT INFORMATION:

For media queries, please contact:

VCI Global Limited
enquiries@v-capital.co

FAQ

What was VCI Global's revenue growth in 2023?

VCI Global's revenue grew by 145% in 2023, reaching $19.8 million.

How much did VCI Global's gross profit increase in 2023?

VCI Global's gross profit increased by 159% to $16.4 million in 2023.

What was VCI Global's net income for 2023?

VCI Global's net income for 2023 was $7.2 million, a growth of 57%.

How much did VCI Global's business strategy consultancy revenue increase in 2023?

VCI Global's business strategy consultancy revenue increased by 265% to $14.7 million in 2023.

What is the 2024 fiscal outlook for VCI Global?

VCI Global expects net sales to increase by approximately 65% and operating income to grow between 20% and 23% in fiscal 2024.

What is the projected operating expense for VCI Global in 2024?

VCI Global's projected operating expense for 2024 is approximately $18.8 million.

What is the effective tax rate for VCI Global in 2024?

The effective tax rate for VCI Global in 2024 is expected to be approximately 5%.