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SYSTEX (6214 TT): Expecting To Launch Cloud Services Platform

2022-03-28 Tech
SYSTEX (6214 TT): Expecting To Launch Cloud Services Platform
  • SYSTEX’s 2021 rev increased 24.4% y-y while EPS decreased 27% y-y due to lower financial asset disposal and revaluation gain, while still showed strong core operating performance with operating profit increased at CAGR of 32.3% in 2016-21.
  • Strong operating leverage mainly comes from higher revenue contribution from financial sector and high-tech sector due to increasing need of digital transformation (DX) and popularity of 5G, AI and IOT, etc.
  • Expect 10% y-y revenue growth in 2022 due to growing TW information service industry, increasing need of DX and launch of cloud management platform (CMP), which management expects the benefit will start to be realized in 2H22.
  • Main growth driver in 2022 will still be VAD business, which implies margins still under pressure.
  • Ample free cash flow and issuance TWD3bn corporate bond in 2021 supports dividend payout and potential M&A. 2021 dividend policy will be decided on 4/12.
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