Profit after tax increased 58 percent to S$16 million in 1999 from S$10.2 million the previous year while earnings per share increased 57 percent to 10.5 cents last year from 6.7 cents in 1998.
"The decrease in revenue is because of less hardware sales as lots of customers differed their purchases due to Y2K concerns," said SCS president and chief executive officer, Stephen Yeo.
"The increase in profits is largely contributed by our services portion which gave us higher margins," Yeo said.
The company expects profit to increase by 20 percent this year, driven by growth from the services sector. Yeo also expects revenue for 2000 to grow as the Asian economy recovers and demand for hardware increases.
He also announced that the company's services portion contributed 36 percent to total sales in 1999 from 30 percent in 1998 while its hardware business recorded a drop to 57 percent from 63 percent although software remained at 7 percent.
SCS closed at S$2.60 on the Singapore Exchange today, up S$0.21 or 8.8 percent.
The company proposed a dividend of 2.2 cents net per share amounting to a total payout of S$3.4 million.
In January, the company formed a S$7 million joint venture with banking giant Overseas-Chinese Banking Group (OCBC) to provide a business-to-business online marketplace for buyers and suppliers. Yeo expects the joint venture called TX123.com to generate profits in 18 to 24 months.
Last December, SCS and E-Venture Investments formed joint venture CarAuc International to provide online auctioning for used cars.
Other e-commerce joint ventures include the establishment of an e-commerce solutions and outsourcing services provider EC1 with GE Information Services in July last year, Asia Business Venture Holdings with Sumitomo Corp and NTUC Link with NTUC.
Incorporated here in 1980, SCS is the information technology (IT) arm of SembCorp Industries, an engineering and technology services group. SCS provides IT consulting, systems integration, outsourcing, networking and e-commerce services.
It also has operations in Australia, Brunei, China, Hongkong, Malaysia, New Zealand, Philippines, Thailand and the US with a more than 1,900 employees in Asia Pacific.
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