Alset International Limited 1H2025: Earnings Analysis and Outlook

Alset International Limited has released its unaudited financial statements for the six months ended 30 June 2025. This review provides a concise breakdown of key financial metrics, historical trends, segmental performance, and notable corporate events, culminating in an analytical outlook and actionable recommendations for investors.

Key Financial Metrics and Performance Overview

*2H2024 not provided in filing; only FY2024 figures are available for comparison.

Historical Performance Trends

Alset International has experienced a dramatic slump in revenue and gross profit in 1H2025, with revenue plunging to S\$23,000 from S\$6.8 million a year earlier. This collapse is mainly due to the absence of property sales in the Black Oak project (down from 95 lots sold in 1H2024 to none in 1H2025) and the disposal of its food and beverage operations in late 2024. Despite cost reductions, the company recorded a net loss of S\$11.0 million, only marginally worse than the prior period due to offsetting cost savings and reduced administrative expenses.

Segmental Performance

• Property Development: Revenue almost disappeared in 1H2025 due to no new lot sales at the Black Oak project.
• Food & Beverage: No revenue recognized as this segment was divested in November 2024. In 1H2024, it contributed S\$0.8 million in revenue.
• Investment Business: Fair value gains and losses on financial assets and promissory notes significantly impacted earnings volatility. In 1H2025, a fair value gain of S\$1.2 million on promissory notes was offset by a S\$4.0 million loss on financial assets.

Exceptional Items and Unusual Expenses

• Significant Net Unrealised Foreign Exchange Loss: S\$3.5 million in 1H2025 (vs. a gain in 1H2024), due to currency movements.
• Fair Value Loss on Financial Assets: S\$3.97 million loss, up from S\$1.3 million in 1H2024.
• Bad Debt Written Off: S\$85,000 in 1H2025; nil in 1H2024.

Divestments and Corporate Actions

• Disposal of HWH International Inc. (including F&B business) completed in November 2024. The group retains an associate interest in HWH via marketable securities.
• No new shares issued, buybacks, or treasury shares in the period. Share capital remained unchanged at 3,492,713,362 shares.
• No dividends declared or recommended due to continuing losses.

Cash Flow and Balance Sheet Position

• Cash and Equivalents: Decreased to S\$18.8 million (from S\$26.2 million as of December 2024) due to operating and investing outflows.
• Working Capital: Fell by S\$10.7 million, reflecting lower current assets and reduced payables.
• Net Asset Value per Share: Declined to 2.05 cents from 2.37 cents as at FY2024.

Guidance and Outlook

The company is finalizing the remaining lot development at Black Oak and exploring new opportunities for finished lot sales and possible contract builds. It has also reserved four fully developed lots for strategic sale or rent, and is planning a new section with seven additional lots, pending regulatory approval. The company’s investment business will continue, focusing on listed shares and marketable securities.

After divesting its F&B segment, Alset remains open to new ventures in this sector, but currently, no material new initiatives have been announced. The group is also optimizing its corporate structure to reduce costs and is seeking land deals where infrastructure costs may be reimbursed by public authorities.

Chairman’s Statement

“The Company is finalising the remaining lot development and construction activity at Lakes at Black Oak in accordance with the various agreements with the lot purchasers after completion of the sale in FY2024. Separately, there are four lots within Section 1 which were previously reserved for model homes. Since these lots are fully developed and no longer needed for model homes, management is evaluating certain elevations and floor plans with local and regional builders via contract-build agreements. The final decisions will be based on current market trends, providing for the highest and best value whilst providing the utmost flexibility to optimize for sale and/or for rent products. Management is also reserving the right to sell them as finished lots to local and regional builders.
The Company has also performed a feasibility study on raw land that is in close proximity to a 500-year floodplain, and impacted by steep slopes. After considerable due diligence, management is creating a new Section 5 that includes seven lots and the potential for a few more based on the outcome of planning and zoning requirements… The Group continues to canvass these markets for lot developments in and around master planned communities that support the finished lot for sale model… The Group will continue to optimise its corporate structure and improve operational efficiency to streamline activities and reduce costs. At the same time, it will closely monitor market trends, evaluate potential investments, and pursue strategic collaborations that can strengthen its position and deliver sustainable, long-term returns.”

The chairman’s tone is pragmatic, acknowledging ongoing operational challenges and an active search for value in development and investment opportunities. There is no overt optimism, but also no hint of immediate crisis.

Events & Risks Affecting the Business

• No dividend due to net losses.
• No share buybacks, treasury shares, or placements.
• No mention of pending legal disputes or regulatory actions.
• Significant exposure to market risk through fair value of financial assets and currency movements.
• Company is exposed to risks if property market or financial asset valuations deteriorate further.

Conclusion & Investor Recommendations

Overall Assessment: Alset International’s financial performance in 1H2025 is weak, with revenue collapsing and losses persisting despite cost reduction efforts. The company is in a period of transition, having divested its F&B business and now relying mainly on the winding down of its property projects and investment gains, which have been volatile and negative.

• If you are currently holding this stock: Caution is warranted. The company has limited revenue visibility, a shrinking asset base, and ongoing losses. Investors should closely monitor the progress of the Black Oak development, future investment gains/losses, and any new strategic initiatives. Consider reducing exposure unless there is clear evidence of a turnaround or new profitable ventures.
• If you are not holding this stock: There is little reason to initiate a position at this stage, given the lack of positive earnings momentum, dividend prospects, or growth drivers. Prospective investors may wish to remain on the sidelines until the company demonstrates stabilizing or improving fundamentals.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consider their individual financial situation and risk tolerance before making investment decisions.

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