Asian Micro Holdings Limited: 1H FY2026 Financial Results Analysis

Asian Micro Holdings Limited (“AMHL”), listed on the Singapore Exchange (Catalist), has released its condensed interim financial statements for the six months ended 31 December 2025. The group operates across manufacturing and trading of clean room packaging, natural gas vehicle-related business, and property development.

Key Financial Metrics and Performance Review

Segmental Performance and Trends

• Revenue Decline: Revenue fell by 16% YoY, mainly due to lower property segment revenue as fewer sales were recognized on a percentage-of-completion basis.
• Gross Margin: Maintained at 24%, indicating stable underlying business profitability despite lower top-line.
• Net Loss Improvement: Net loss narrowed significantly from S\$0.12m to S\$0.04m, primarily due to gains from asset disposals (investment properties and motor vehicle).
• Non-current Assets: Dropped from S\$0.39m to S\$0.08m due to the sale of investment properties.
• Current Assets: Rose to S\$4.81m, mainly from increased development properties and inventories, partially offset by lower cash.
• Current Liabilities: Fell to S\$2.65m, aided by repayments of payables and accrued expenses, though director loans increased.
• Net Asset Value: Jumped to S\$2.24m, reflecting strengthened capital base from debt conversion into equity (966 million new shares issued).
• Cash Flow: Net cash outflow from operating activities S\$1.06m, offset by S\$0.44m inflow from investing (sale of asset) and S\$0.34m inflow from financing (director loan).

Exceptional Items & Corporate Actions

• Asset Sale: Disposal of investment properties brought in S\$481,000 cash and a gain of S\$133,000.
• Debt Conversion: S\$966,000 of debt converted to equity, diluting shareholders but improving balance sheet strength.
• Director Loan: Interest-free loan from controlling shareholder/director: RM 2,040,000 outstanding.

Dividend Policy

• No dividend declared for 1H FY2026 or the prior periods. The company continues to conserve cash given operating losses and asset sales.

Management Commentary & Outlook

Management expects the operating business environment in the next 12 months to remain challenging due to global economic uncertainties. Despite the challenging market condition in which the businesses operate, the Group continues its focus on operational efficiency, cost control, cash conservation and ensuring sustainability of its existing businesses.

The tone is cautious and realistic, with management emphasizing cost control and sustainability rather than growth or expansion.

Related-Party Transactions & Other Risks

• Related-Party Loan: Significant director loan outstanding; no IPT mandate obtained.
• Going Concern: The company’s current liabilities exceed current assets at the company level. Directors state that continued financial support from major shareholders will ensure going concern status.
• No New Legal Issues or Policy Changes: No reported litigation or regulatory shifts.

Share Capital Changes and Dilution

• Share base increased from 1.71 billion to 2.68 billion shares due to debt conversion, diluting existing shareholders but reducing leverage.

Conclusion & Investment Recommendations

Overall Assessment: Asian Micro Holdings shows some improvement in bottom-line losses, primarily due to asset sales, not operational strength. The core business remains challenged with declining revenue and cash outflows. NAV has increased through equity injection, but the business relies on shareholder support for liquidity.

• If you currently hold this stock:
  • Consider maintaining a cautious stance. The company’s operational outlook remains weak, and future dilution or asset sales may further impact shareholder value. If you are a risk-averse investor, review your position and monitor for signs of operational turnaround, not just asset disposal gains.
• If you are not holding this stock:
  • There is no immediate catalyst for a positive re-rating. The stock is suited only for speculative investors who expect management to successfully restructure or unlock further asset value in future. Otherwise, wait for signs of sustained operational improvement before initiating a position.

Disclaimer: This analysis is based solely on information disclosed in the latest interim report and does not constitute financial advice. Investors should consider their own financial circumstances and consult a qualified adviser before making any investment decisions.

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