SYS Annual Corporate Briefing CY2023

Systems Limited recently conducted their annual briefing to discuss their performance in the past year and outline their plans for the future. Here’s a breakdown of the key details shared during the briefing:

Financial Performance

Systems Limited (SYS) reported a Profit After Tax (PAT) of Rs8.6 billion in CY23, marking a growth of 31% compared to the previous year.

This translates to an Earnings Per Share (EPS) of Rs29.8/share, up from Rs22.8/share in the previous year.

The company also declared a final cash dividend of Rs6/share for CY23.

Customer Base

SYS boasts a diverse customer base spanning various sectors. The majority of their clients are in the Banking and Financial sector (63), followed by Retail & Consumer Packaged Goods (CPG) at 44, and Technology at 35.

Additionally, the company serves clients in other segments such as Public, Healthcare, Manufacturing, and Telecommunications.

Clientele and Growth Strategy

SYS currently serves 236 active clients, with a focus on targeting specific clients to drive growth and efficiency.

The company is adopting a more focused-based strategy to ensure higher growth rates.

Expansion Plans

SYS plans to continue investing in foreign markets to fuel growth. Their aggressive approach led to a significant growth rate of around 75% in the Middle Eastern Region in CY23.

However, they anticipate growth to continue at a slightly slower pace moving forward.

Financial Challenges and Margins

In CY23, SYS faced challenges such as inflationary pressures, higher energy prices, and currency devaluation, leading to lower Gross Profit (GP) margins.

Operating margins declined to 14% in CY23 compared to 17% in the previous year, mainly due to the incorporation of a new subsidy and one-off impairment adjustments.

Revenue Sources

The company’s revenue is primarily generated from the Middle East & Africa region (55%), followed by North America (23%) and Pakistan (16%). European and Asian regions contribute 4% and 2%, respectively.

Human Resources and Development

SYS is focused on hiring and developing new talent, adding 1200 employees in CY23, bringing the total count to 7000, with 86% based in Pakistan.

Dividend Policy and Currency Structure

The company has maintained a 20% dividend policy for the past year and intends to continue this moving forward.

Around 95% of SYS’s revenue is in foreign currency, while 60% of their costs are in PKR.

Support for IT Parks

SYS encourages the growth of IT parks in the country to boost client confidence and inspire the younger generation to pursue careers in IT.

In conclusion, Systems Limited remains focused on driving growth, maintaining financial stability, and nurturing talent while navigating challenges in the market. With a diversified clientele and strategic expansion plans, the company aims to sustain its upward trajectory in the future.