Qian Hu Corporation Limited FY2025 Results: A Detailed Financial Analysis

Qian Hu Corporation Limited, a leading player in the ornamental fish, aquaculture, aquarium, and pet accessories markets, has released its audited results for the financial year ended 31 December 2025. In this article, we analyze the company’s key financial metrics, business segment performance, cash flows, dividend policies, and outlook for FY2026.

Key Financial Metrics & Segment Performance

*Calculated/approximated where not directly provided; NM: Not meaningful due to negative swing from profit to loss.

Business Segment Performance

• Fish Segment: Revenue grew 4.5% YoY to \$30.7m in FY2025, but segment profit before tax fell 10.4% to \$1.84m, in part due to lower handling fees and changes in product mix.
• Accessories Segment: Revenue declined 1.6% to \$33.5m, with profit before tax dropping 50.4% to \$0.51m. The prior year included a one-off land compensation gain (~\$0.7m), masking underlying operational improvements.
• Plastics Segment: Revenue contracted by 3.8% to \$7.8m and profit before tax fell 11.8% to \$0.87m, reflecting higher raw material costs and operational expenses.

Dividends

• No final dividend was declared for FY2025, compared to a 0.4 cent per share payout in FY2024. The board cited accumulated losses and a need to conserve cash for strategic initiatives, including land lease renewals in Singapore and other projects.

Historical Performance Trends

• Revenue: The group achieved record revenue of \$71.9m (+0.7% YoY), but this was not matched by profit performance.
• Profitability: The group swung from a profit of \$416k in FY2024 to a loss of \$602k in FY2025, mainly due to the absence of exceptional income (e.g., one-off land compensation in China in FY2024) and higher finance costs.
• Cash Flow: Net cash from operations remained positive and stable, despite the loss, supported by improved working capital management.
• Balance Sheet: Net asset value per share fell from 35.04 cents to 33.99 cents; the group’s debt-to-equity ratio rose from 0.38 to 0.49, mainly due to the acquisition of a freehold property in Malaysia funded by new bank borrowings.

Exceptional Items and Noteworthy Transactions

• Exceptional Income: FY2024 included a \$0.7m compensation gain from land expropriation in China, not repeated in FY2025.
• Asset Acquisition: The group acquired Aquaeasy (an AI/IoT-based aquaculture technology company) and a freehold office-cum-warehouse in Malaysia, supporting future growth and digitalization initiatives.
• Convertible Loan: The company derecognized a \$1.4m convertible loan in connection with the Aquaeasy acquisition and extended a new \$0.5m loan to N&E Innovations.
• No Share Buybacks or Dilution: There were no share buybacks, new issues, or dilution events reported.

Macroeconomic and Operating Environment

• The group highlighted persistent macroeconomic and geopolitical uncertainties, including trade tensions, uneven recovery in China, and subdued consumer sentiment in Europe.
• Management expects stable demand for ornamental fish and essentials, but remains cautious given potential external shocks and cost pressures.

Forecast and Outlook

• The board expects Qian Hu to return to profitability in FY2026, supported by business diversification, ongoing investments in technology, and operational streamlining.
• Key strategic focus areas include digital farm management (post-Aquaeasy acquisition), expansion of pet wellness and hygiene products, and cost discipline in the plastics business.
• No cash dividend is planned until the company returns to profitability and accumulates sufficient retained earnings.

Full Chairman’s Statement

“As we enter FY 2026, the global operating environment is expected to remain challenging amid persistent macroeconomic and geopolitical uncertainties. Elevated geopolitical tensions, ongoing regional conflicts, and trade policy uncertainties — particularly relating to tariffs and supply chains — continue to weigh on business confidence and consumer sentiment across multiple markets. While inflationary pressures have moderated in some economies, cost sensitivities and cautious spending persist.

The United States continues to be an important market for the Group, particularly for ornamental fish exports and selected aquarium and pet accessories. Demand conditions have moderated due to tariff-related uncertainties and higher operating and logistics costs. Nevertheless, underlying consumer interest in essential pet and aquarium products has remained relatively resilient, supported by the non-discretionary nature of core pet care spending.

Economic conditions in Europe remain mixed, with consumer spending constrained by lingering inflation and higher living costs, leading to more selective purchasing patterns. China’s economic recovery remains uneven, affecting both domestic consumption and export-oriented activities. In contrast, ASEAN markets have demonstrated relative stable domestic demand, improving tourism activity and continued intra-regional trade.

Against this backdrop, we have mapped out clear strategic priorities across its businesses, focusing on disciplined execution, productivity enhancement and operational resilience. A key milestone in FY 2025 was the acquisition of Aquaeasy, strengthening our position in the aquaculture sector through AI and IoT technologies that enhance productivity, improve predictability, and support sustainable farming practices.

Taking these factors into consideration, we believe that our diversified business portfolio, disciplined operations, and ongoing investments in technology and innovation position Qian Hu well to navigate the year ahead.”

The chairman’s tone is cautiously optimistic, acknowledging global uncertainties but highlighting the group’s strategic positioning and resilience.

Directors’ Remuneration

• Total directors’ fees for FY2025 were \$80,000, unchanged from the prior year.

Conclusion and Recommendation

Overall, Qian Hu’s FY2025 performance is weak, with a swing to loss despite stable revenue, due to the absence of exceptional income, higher finance costs, and persistent macroeconomic headwinds. However, operational cash flows remain positive, and the group is investing for future growth, particularly in technology-driven aquaculture and pet wellness products. Management expects a return to profitability in FY2026.

Investor Recommendations:

• If you currently hold Qian Hu shares: Consider holding your position if you have a medium-to-long term horizon and confidence in management’s turnaround strategy. The group is investing in growth areas and digitalization, but near-term volatility remains. Note the absence of dividends for FY2025 and the need for patience until profitability is restored.
• If you do not currently own Qian Hu shares: It may be prudent to wait for clearer signs of operational turnaround and a return to profitability before initiating a new position. Keep an eye on upcoming quarters for evidence of improved margins and sustained cash flows from new initiatives.

Disclaimer: This analysis is based solely on the financial statements and disclosures provided in Qian Hu Corporation Limited’s FY2025 report. It does not constitute investment advice. Please conduct your own due diligence and consider your risk tolerance before making investment decisions.

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