Metech International Limited: Q3 and 9M FY2025 Financial Analysis

Metech International Limited, a Singapore-based investment holding company listed on the Catalist Board of the SGX, has released its unaudited condensed interim financial statements for the three and nine months ended 30 September 2025. The report provides insights into the company’s performance across its three business segments: Health Supplements, Lab-Grown Diamonds, and Food Waste Management.

Key Financial Metrics and Performance Review

Historical Performance Trends

• Revenue: The Health Supplements Business became a significant contributor in 9M FY2025, with S\$3.06 million in revenue (vs. S\$45k in 9M FY2024). However, no revenue was generated in Q3 FY2025, largely due to delays in licensing in China for health supplements.
• Net Loss: Losses narrowed YoY, with a 45% decrease in net loss for 9M FY2025 compared to 9M FY2024, driven by higher revenue from the Health Supplements Business and lower administrative expenses.
• Gross Margin: Gross margin fell sharply from 75.56% in 9M FY2024 to 11.04% in 9M FY2025, reflecting cost normalization after inventory impairment in prior periods.
• Cash Position: Cash and bank balances dropped steeply to S\$44,000 (from S\$1.47 million at end FY2024), mainly due to increased trade receivables and repayment of lease liabilities.
• Negative Working Capital: Negative working capital improved slightly (S\$1.71 million vs. S\$2.04 million at end FY2024), but liquidity remains tight.

Exceptional Earnings, Expenses, and Corporate Actions

• Debt Capitalisation: The company converted S\$296,000 of employee loans into shares, strengthening its balance sheet but diluting equity holders. No new cash was raised from this conversion.
• No Dividend: No interim or final dividend was proposed for Q3 FY2025 or for the prior period. The company states it currently has no accumulated profits for dividend purposes.
• Asset Sales: The company disposed of plant and machinery, generating S\$119k in cash during 9M FY2025.
• Proposed Disposal: Metech announced the proposed sale of its 80% stake in Asian Eco Technology Pte. Ltd., which carries the lab-grown diamond business, citing poor results and ongoing losses in this segment.
• Fundraising: In addition to loan-to-equity conversions, the company drew down S\$949k in interest-free loans from an employee, with S\$1.3 million outstanding on the Second Loan as at Q3 FY2025.
• No Share Buybacks: There were no share buybacks, option exercises, or new mandates.

Events and Risks Affecting Business Outlook

• Going Concern Risk: The company remains under material uncertainty regarding going concern, with accumulated losses, negative equity, and reliance on further fundraising, cost-cutting, and business diversification.
• Licensing Delays: Health Supplements sales in China were delayed due to licensing, but the company expects revenue to resume in Q4 FY2025.
• Strategic Partnerships: Metech is exploring collaborations with Burpple 2021 Pte. Ltd. and MLF Ingredients Sdn. Bhd. to expand health supplements and food waste businesses. These partnerships are not yet finalized.
• Food Waste Business: Commercial testing of biomass carbon reduction machines is expected to begin soon. Negotiations with partners are ongoing, but revenue contribution is not yet material.
• Lab-Grown Diamonds: Business performance has been weak, and the proposed disposal of this segment may reduce future losses.

Directors’ Remuneration and Related Party Transactions

• No specific director remuneration details were disclosed in the report.
• No interested person transactions exceeding S\$100,000 occurred during the period.

Chairman’s Statement

No full Chairman’s Statement was included in the report.

Forecast and Industry Commentary

• Health Supplements: The company sees growth opportunities in personalized wellness, gut health, and digital health, supported by consumer trends towards holistic wellness, especially among millennials and Gen Z.
• Food Waste: There is potential economic value in food waste management, with initial testing showing promising results. However, full commercialization is pending.
• Lab-Grown Diamonds: The segment is being divested due to persistent losses and unfavorable market conditions.

Conclusion and Investment Recommendations

Overall Financial Performance and Outlook: Metech International Limited’s financial position remains weak. Despite a significant revenue boost from the Health Supplements segment, the company continues to record losses, has a precarious cash position, and faces material uncertainty regarding its ability to continue as a going concern. Asset sales and ongoing fundraising have provided short-term liquidity, but the negative equity and heavy reliance on further external financing remain concerns. The disposal of the struggling diamond business may reduce future losses, but new segments are not yet proven contributors.

Investor Advice

• If you currently hold Metech shares: Exercise caution. The company is undergoing a major restructuring, faces liquidity challenges, and has not provided a dividend. If you have a high-risk tolerance and believe in the turnaround potential of the Health Supplements or Food Waste businesses, you may consider holding for future developments. Otherwise, consider reducing exposure until clearer signs of sustainable profitability and cash flow emerge.
• If you do not hold Metech shares: It may be prudent to remain on the sidelines. The company faces substantial financial and operational risks, and its turnaround depends on uncertain new business ventures and fundraising. Only consider investing if the company demonstrates consistent revenue growth, improved margins, and a stabilized cash position in future reporting periods.

Disclaimer: This commentary is based strictly on the content of Metech’s Q3 and 9M FY2025 financial report and does not constitute financial advice. Investors should conduct their own research or consult with a licensed adviser before making any investment decisions.

View Metech Intl Historical chart here