Shopper360 Limited: FY2025 Financial Analysis – Net Profit Significantly Declined

Report Overview

• Date of Report: July 30, 2025 [[36]]
• Financial Year: Full Year Ended May 31, 2025 [[1]]

Business Description

• Core Business: Shopper360 Limited is an investment holding company. [[9]]
• Business Segments:
  • Advertising and Marketing: Brand awareness, in-store advertising, promoter services, marketing programs. [[9-10]]
  • Sales Execution and Distribution: Merchandising, sales force, talent management, product distribution. [[10]]
  • Investment Holding and Others: Management and corporate services. [[10]]
• Geographic Footprint: Primarily operates in Malaysia. [[16]]

Financial Statement Analysis

Income Statement

• Revenue: Increased slightly by 2% from RM180.7 million in FY2024 to RM184.2 million in FY2025. [[28]]
• Cost of Sales: Increased by 8% from RM142.9 million to RM154.9 million. [[28]]
• Gross Profit: Decreased by 22% from RM37.8 million to RM29.4 million. [[28]]
• Other Income: Decreased significantly by 84% from RM5.0 million to RM0.8 million. [[28]]
• Administrative Expenses: Decreased by 15% from RM35.8 million to RM30.4 million. [[28]]
• Fair Value Loss on Financial Asset at Fair Value Through Profit or Loss: Recorded a loss of RM8.74 million in FY2025 compared to a loss of RM2.38 million in FY2024. [[29]]
• Finance Costs: Decreased by 31% from RM234,000 to RM161,000. [[29]]
• Share of Results of Associated Companies: Increased losses by 642% from RM0.2 million to RM1.6 million. [[29]]
• (Loss)/Profit Before Tax: Switched from a profit of RM4.2 million in FY2024 to a loss of RM11.8 million in FY2025. [[29]]
• Income Tax Expense: Decreased by 29% from RM2.2 million to RM1.6 million. [[29]]
• (Loss)/profit for the period/year: Switched from a profit of RM1.98 million in FY2024 to a loss of RM13.30 million in FY2025. [[2]]

Balance Sheet

• Non-Current Assets: Decreased by RM10.0 million, from RM30.0 million to RM20.0 million. [[29]]
• Current Assets: Marginally decreased by RM0.02 million. [[30]]
• Equity: Decreased by RM10.1 million, from RM74.7 million to RM64.6 million. [[30]]
• Non-Current Liabilities: Decreased by approximately RM0.3 million. [[30]]
• Current Liabilities: Increased by RM0.4 million. [[30]]
• Working Capital: Positive working capital of RM45.1 million as at 31 May 2025, as compared to RM45.6 million as at 31 May 2024. [[31]]

Cash Flow Statement

• Net Cash Used in Operating Activities: RM8.2 million outflow. [[31]]
• Net Cash Used in Investing Activities: RM0.8 million outflow. [[31]]
• Net Cash Generated from Financing Activities: RM1.5 million inflow. [[31]]
• Cash and Cash Equivalents: Decreased by RM7.7 million. [[31]]

Key Findings and Analysis

• Revenue Growth: Marginal increase in revenue, indicating some market traction.
• Profitability Decline: Significant drop in gross profit and a switch to a substantial net loss, driven by higher costs, reduced other income, and losses from associated companies and financial assets.
• Asset Changes: Decrease in non-current assets, particularly financial assets and investments, raises concerns about investment performance.
• Cash Flow Concerns: Negative cash flow from operations indicates potential liquidity issues.

Key Facts for Investor Action

• Fair Value Loss: Significant fair value loss on financial assets at fair value through profit or loss (FVTPL) relates to investment in CCCPS. [[29]]
• Liquidation: Loss on liquidation of shopperPlus Myanmar Co. Ltd. [[29]]
• Capital Injection: The Group increased its equity in ShopperPlus Sdn. Bhd. (SPSB) through a debt capitalisation exercise amounting to RM1.0 million in November 2024 and a cash injection of additional capital of RM1.0 million in December 2024. [[22]]
• No Dividend: No dividend was proposed by the Board of Directors for the forthcoming annual general meeting of the Company. [[33]]

Company Actions to Improve Profitability

• shopper360 has pruned several non-performing divisions and is now strategically placed to unlock new growth by offering integrated, digital-first, and insight-led retail solutions. [[32]]
• Combining capabilities across merchandising, activations, media, and loyalty through contests gamification, and by embracing innovation and sustainability, the Group is confident in its ability to deliver enhanced value to its clients in the year ahead. [[32]]

Recommendations

• For Current Stockholders: Given the significant net loss, negative operating cash flow, and concerning trends in profitability, it’s advisable to reduce holdings in the stock. Closely monitor the company’s efforts to improve profitability and consider exiting the position if improvements are not evident in the short term.
• For Potential Investors: Given the financials, it is not advisable to invest in this company.

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