VCI Global Limited Q2 FY2023 earnings call

• CEO Victor Hoo highlighted strong growth across all business segments, with Strategy Consulting becoming the advisor of choice for high-potential companies seeking to go public and making inroads with major development projects in Malaysia. - Technology Solutions had success capitalizing on demand for AI services, including a collaboration with Fusionex, being selected as exclusive distributor for Cogia's messenger product, and signing an agreement to be exclusive licensee of an AI modeling platform across nine Asia Pacific regions. - CFO Zhi Feng Ang noted record revenue growth, with Strategy Consulting up 83% and Technology Solutions up 104%, operating expenses at 54% of revenue (down from 65% last period), operating income at $226,000, net income up 37% to $4.3 million, and earnings per share up 33% to $0.12 per share, with a healthy balance sheet having $3.3 million in cash and equivalents.

In the first half of 2023, VCI Global achieved record revenue of $9.5 million, growing 108% period-over-period. The Strategy Consulting segment saw revenue increase by 83% to $4.5 million, primarily driven by IPO advisory wins. The Technology Solutions segment grew 104% to $4.2 million. The Strategy Consulting segment contributed approximately 47.37% to total revenue ($4.5 million divided by $9.5 million), and the Technology Solutions segment contributed approximately 44.21% to total revenue ($4.2 million divided by $9.5 million).

• Expect full-year revenue growth of at least 90%. - Continue targeting higher margin consulting services and partnerships to drive improved profitability. - Aggressively evaluating potential acquisitions to further enhance capabilities.

Q: Do you believe you can sustain this level of growth or were there any circumstances related to this revenue, for instance, one-time or lumpiness that could lead to lower revenue growth in future periods?

A: Yes, we certainly believe that we can sustain this level of growth as we have a healthy partners of IPO clients in the second half as well as going into 2024.

Q: What would you consider the best KPIs that investors should measure and track in order to determine the health and growth prospects for your business on a go-forward basis?

A: Our key performance indicators definitely are revenue growth and profitability. We believe these are the best indicators for the financial and the operating health of our company.

Q: What is the average length of your business consultancy retainer engagements?

A: Our retainer and [indiscernible] on a yearly renewal basis, however, most of these clients usually stay with us on a long-term basis.