Financial Performance in Detail

Revenue Analysis

Q3 2025: Group revenue fell 9% year-on-year to S\$59.3 million, mainly due to lower sales in the Semiconductor (-8%) and Aerospace (-16%) segments. However, the ‘Others’ segment rose 5%. Singapore and USA sales dropped sharply (-21% and -33% respectively), while Malaysia (+71%) and ‘Others’ (+99%) saw strong gains, reflecting successful new customer acquisition and expanded shipments.

9M 2025: Revenue increased 5% to S\$184.3 million, led by a 7% rise in Semiconductor sales, especially components (+15% YoY), though integrated system sales were flat. Aerospace and ‘Others’ declined slightly. Malaysia (+164%) and ‘Others’ (+26%) offset declines in Singapore (-5%) and USA (-13%).

Profitability & Margins

Gross Margin: Improved to 58.2% in Q3 and 56.1% for 9M, due to product mix changes and productivity gains.

Net Profit: Q3 net profit rose 11% YoY to S\$11.4 million. 9M net profit for the group reached S\$32.0 million (+7% YoY), with net profit attributable to shareholders at S\$30.5 million (+4% YoY).

EPS: Earnings per share for Q3 and 9M were 1.47 cents and 4.30 cents respectively, slightly up from last year.

Expenses: Employee benefits dropped 17% in Q3 due to lower bonus provision, but depreciation (+22% Q3, +30% 9M) and other charges (notably inventory provision and FX losses) increased. Utilities costs rose with new facilities. Finance income fell due to lower cash balances.

Cash Flow and Financial Position

Operating Cash Flow: Q3 operating cash flow was S\$1.7 million (down from S\$15.9 million last year), mainly impacted by higher inventory levels. 9M operating cash flow was S\$16.9 million (vs S\$30.3 million in 9M2024).

Capex: Heavy investment of S\$35.4 million in new Penang plant and expansion plans.

Dividends: Total payout in 9M was S\$21.3 million.

Net Cash: Decreased by S\$41 million to S\$38.2 million, but balance sheet remains healthy with net asset value per share at 60.25 cents.

Strategic Developments & Potential Share Price Drivers

• Secondary Listing on Bursa Malaysia: This has increased market visibility and access to a broader investor base, with market cap now above S\$1 billion.
• Bonus Share Issue: Proposed 1-for-4 bonus share issue is likely to increase liquidity and may impact short-term share price dynamics.
• Dividend Consistency: Ongoing commitment to dividend payouts supports shareholder returns, with payment date set for 17 December 2025.
• Industry Trends: Semiconductor sector outlook is bullish with record investments globally, especially in advanced chip manufacturing and memory. Aerospace sector is also growing, driven by air travel demand and defence budgets.
• New Customer Acquisition: Rapid revenue growth in Malaysia and Korea from new customers could be a catalyst for future earnings and share price appreciation.

Risks & Shareholder Considerations

• Rising Expenses: Depreciation and certain operating costs have increased with expansion, which could pressure margins if not offset by higher sales.
• Foreign Exchange Volatility: Significant FX losses reported in 9M2025 due to USD depreciation.
• Global Uncertainties: Trade tensions, geopolitical issues, and supply chain constraints remain a concern, though the company is taking active measures to manage risks.
• Interested Person Transactions: S\$1.685 million paid to Sure Achieve Consultant Pte Ltd (linked to CEO’s family) for consultancy and commissions; represents 0.47% of net tangible assets. Shareholders may want to monitor related party transactions.
• Use of Proceeds: Of the S\$49.9 million raised in January 2024, S\$29.95 million was used for capex, S\$9.98 million for working capital, with S\$9.98 million still earmarked for future investments.

Outlook

The company expects to remain profitable for the full year 2025, supported by industry tailwinds, ongoing expansion, and new customer orders. The high capex and bonus issue signal confidence in future growth. Barring unforeseen circumstances, management maintains a positive outlook.

Share Price Sensitivity: The announcement of a bonus share issue, solid Q3/9M results, successful Bursa Malaysia listing, and continued new customer growth are all potentially price-sensitive developments that could move the share price.

Dividend and Bonus Share Details

• Interim Dividend: 1.0 cent per share (SGD), payable on 17 December 2025.
• Record Date: 2 December 2025 (books close on 1 December).
• Malaysian shareholders will receive MYR 3.20 per share (SGD/MYR rate of 3.20).
• Proposed 1-for-4 bonus share issue (details to follow from the Board).

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consult with professional advisors before making any investment decisions. The information is based on unaudited financial statements and forward-looking statements which are subject to risks and uncertainties.

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