Tye Soon Limited: 1H25 Financial Analysis and Investor Insights
Tye Soon Limited, a Singapore-based distributor of automotive parts, released its unaudited condensed interim consolidated financial statements for the six months ended 30 June 2025. The report provides a comprehensive overview of the company’s performance, financial health, and industry outlook. Here is a detailed analysis for investors and market watchers.
Key Financial Metrics and Comparative Performance
Metric |
1H25 (Current) |
2H24 (Previous Half) |
1H24 (Year Ago) |
YoY Change (%) |
QoQ Change (%) |
Revenue |
\$130.9m |
\$125.8m (inferred) |
\$128.5m |
+1.9% |
+4.1% (inferred) |
Profit Before Tax |
\$2.5m |
\$2.7m (inferred) |
\$3.1m |
-20.0% |
-7.4% (inferred) |
Net Profit Attributable |
\$2.12m |
\$1.97m (inferred) |
\$2.35m |
-9.7% |
+7.6% (inferred) |
EPS (cents) |
2.43 |
2.26 (inferred) |
2.69 |
-9.7% |
+7.5% (inferred) |
Dividend per Share (Interim) |
\$0.00638 |
\$0.01275 (final) |
\$0.00638 |
0% |
-50% (vs final) |
Net Asset Value/Share (cents) |
73.1 |
71.4 |
71.0 (inferred) |
+3.0% |
+2.4% |
Historical Performance Trends and Financial Highlights
- Revenue Growth: Group revenue increased by 1.9% YoY to \$130.9m, but would have been 4.2% higher excluding currency translation effects. The SGD’s appreciation against KRW and AUD dampened reported revenue.
- Profitability: Profit before tax declined 20% YoY to \$2.5m as margin pressure and higher logistics costs offset gains from South Korea and Australia. Net profit attributable to owners fell to \$2.12m, down 9.7% YoY.
- EPS: Earnings per share slipped from 2.69 cents to 2.43 cents, mirroring the profit decline.
- Dividends: Interim dividend was maintained at \$0.00638, same as the previous interim period, but half the final dividend declared for FY24.
- Net Asset Value: NAV per share increased modestly to 73.1 cents.
Balance Sheet and Cash Flow Review
- Right-of-Use Assets: Down \$0.1m to \$6.3m due to depreciation and additions.
- Inventories: Up \$1.2m to \$126.4m (7.4 months’ coverage), reflecting inventory build-up for anticipated demand.
- Receivables: Increased \$2.3m to \$34.6m (up to 1.6 months’ coverage).
- Loans and Borrowings: Rose \$4.3m to \$83.2m, mainly from trade-related bills.
- Payables: Decreased \$3.3m to \$33.8m, as the Group paid down suppliers more aggressively.
- Cash: Down \$2.1m to \$12.6m.
- Current Ratio: Stable at 1.5x.
- Net Gearing: Increased to 1.11x (from 1.03x) due to drawdown of bank facilities and paydown of trade payables.
- Operating Cash Flow: \$6.9m generated, offset by \$0.2m used in investing and \$8.6m outflow from financing (mainly loan repayments).
Industry Trends and Outlook
- Currency Impact: SGD strength versus KRW and AUD continued to impact reported revenue. MYR showed some appreciation in 1H25 for the first time in three years.
- Competitive Intensity: Remained high, especially in Australia and Malaysia. The company responded by providing higher service levels and flexible pricing, which helped retain customers but compressed margins.
- Macroeconomic Uncertainty: The reordering of the global trading system and elevated US tariffs indirectly affected sentiment among export customers, despite Tye Soon’s low direct exposure to the US market.
- Operating Costs: Group maintained discipline, slowing the rise in costs despite wage and logistics pressures.
- Management Commentary: “The Group’s focus on slowing down the upward trend in operating costs whilst expanding its activities continues to flatten the upward cost trajectory. Despite the softer outlook on margins, the Group remains on track for another year of profitable growth.” (Tone: cautiously positive)
Dividends
- Interim dividend of \$0.00638 per share declared; unchanged from the prior interim period and paid as a tax-exempt (one-tier) cash dividend.
- Final dividend for FY24 was \$0.01275 per share.
Directors’ Remuneration
- Total key management compensation in 1H25: \$567,000 (Directors’ fees: \$113,000; Short-term employee benefits: \$435,000; Post-employment benefits: \$19,000).
Related Party Transactions
- Sales to a shareholder company totaled \$94,000 in 1H25; transactions were carried out on agreed terms.
Exceptional Items and Risks
- No divestments, IPOs, share buybacks, or asset sales were reported.
- No legal disputes, court cases, or natural disasters mentioned.
- No errors or inconsistencies identified in the accounts.
Outlook and Management Guidance
- Competitive intensity is expected to persist, especially with cost-of-living pressures and destocking by smaller competitors.
- US tariffs continue to weigh on global sentiment and may dampen export demand from Singapore in the near term.
- Currency movements remain a key variable for reported results. If KRW and AUD rebound, Group revenue could see a significant uplift.
- Despite margin softness, management expects profitable growth for the year.
Conclusion and Investor Recommendations
Overall Assessment: Tye Soon Limited’s 1H25 results reflect resilience in revenue growth and customer retention amid margin pressure and macro uncertainty. The company’s steady cash generation, disciplined cost control, and stable dividend policy suggest a neutral-to-cautiously positive outlook, provided currency headwinds and competitive intensity do not worsen.
- If you currently hold Tye Soon stock: Consider holding your position. The Group remains profitable, maintains a steady dividend, and management is focused on cost control and customer retention. Watch for any further margin erosion and currency volatility, which could impact future performance.
- If you do not currently hold Tye Soon stock: Consider a wait-and-see approach. While the Group offers stable dividends and is navigating challenges well, margin pressures and macro uncertainty (especially from US tariff effects and currency headwinds) may limit upside in the near term. Monitor for signs of margin recovery and currency stabilization before entering.
Disclaimer: This analysis is based strictly on published financial statements and does not constitute investment advice. Investors should conduct their own due diligence and consider their own risk tolerance and investment objectives before making any decisions.
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