Envictus International Holdings Limited Q1 2026 Financial Results: Revenue Up, Profit Down, No Dividend Declared

Envictus International Holdings Limited: Q1 FY2026 Financial Analysis and Outlook

Envictus International Holdings Limited, listed on the Singapore Exchange, reported its condensed interim financial results for the three months ended 31 December 2025. The Group operates across three main business segments: Food Services (Texas Chicken and San Francisco Coffee), Trading and Frozen Food, and Dairies (manufacturing and distribution of condensed and evaporated milk).

Key Financial Metrics and Performance Summary

Metric	Q1 FY2026 (31 Dec 2025)	Q4 FY2025 (30 Sep 2025)	Q1 FY2025 (31 Dec 2024)	YoY Change	QoQ Change
Revenue (RM’000)	198,156	N/A	192,942	+2.7%	N/A
Gross Profit (RM’000)	84,781	N/A	89,054	-4.8%	N/A
Profit Before Tax (RM’000)	11,473	N/A	15,108	-24.1%	N/A
Net Profit (RM’000)	8,427	N/A	11,740	-28.2%	N/A
EPS (RM sen)	2.77	N/A	3.86	-28.2%	N/A
Net Asset Value/Share (RM)	0.77	0.75	N/A	N/A	+2.7%
Dividend (RM sen)	0.00	0.00	0.00	–	–

Segment Performance Highlights

Dairies Division: Revenue surged by 34.3% YoY, driven by higher production capacity, new supermarket/wholesale channels, and export market expansion (notably Cambodia).
Trading & Frozen Food Division: Revenue rose by 13.3% YoY, supported by seasonal demand, higher tourist arrivals, and increased sales to retail and proprietary customers.
Food Services Division: Revenue declined by 8.8% YoY. Texas Chicken outlet sales fell 7.7% (cautious consumer spending), and San Francisco Coffee sales dropped 22.6% (streamlining and closures).

Cash Flow and Balance Sheet Position

Operating Cash Flow: RM14.3 million (Q1 FY2026), a significant improvement from RM3.4 million YoY, supported by better working capital management.
Net Cash Position: Cash and cash equivalents increased to RM63.5 million as at 31 December 2025.
Net Assets: Improved to RM234.5 million from RM227.9 million at the end of the previous quarter.

Dividends

No interim dividend was declared for the period. The company states the need to conserve cash for expansion purposes.

Significant Events and Corporate Actions

Asset Sale Proceeds: In April 2025, the group received RM33.7 million in deferred proceeds from a major asset sale completed in October 2023. As of February 2026, RM919,000 remains unutilized.
Acquisition: In January 2026, an indirect subsidiary agreed to acquire a new factory and warehouse for RM68 million, to be funded via cash and new bank financing.
Store Expansion: Texas Chicken plans at least 15 new outlets in FY2026, including expansion into Sabah. San Francisco Coffee is shifting towards kiosk formats to reduce overheads.

Related Party Transactions and Unusual Items

Related-party insurance premiums (RM0.7 million) and rentals (RM0.1 million) were paid in the quarter.
Other income saw a large increase due to foreign currency gains (RM2.1 million) and lease modification gains (RM2.5 million).
Other operating expenses rose due to increased provision for expected credit losses under SFRS(I) 9.

Chairman’s Statement and Management Tone

“Looking ahead, the Group will continue to focus on disciplined cost management, prudent capital allocation, and selective expansion, while investing in digitalisation, brand development, and supply chain resilience. With strong risk monitoring and contingency planning in place, the Group is well positioned to manage rising costs, regulatory changes, supply disruptions, and evolving consumer sentiment. Despite near-term challenges, the Group remains confident in navigating the business landscape and delivering sustainable long-term growth.”

Tone: The Chairman’s statement is cautiously optimistic, emphasizing resilience, prudent management, and confidence in long-term growth despite acknowledging current market challenges.

Business Environment and Outlook

Malaysia’s 2026 economic outlook is supported by resilient domestic demand and easing input costs (notably sugar and raw materials).
Food Services faces intense competition and margin pressure from higher operating costs and value-conscious consumers.
Dairies Division benefits from stable and favorable input prices and plans to defend market share with tactical pricing and promotions.
Trading & Frozen Food expects seasonal fluctuations but is expanding its omni-channel presence and product range.

Conclusion and Investment Recommendation

Overall Assessment: Envictus delivered modest revenue growth (+2.7% YoY), but faced a significant drop in net profit (-28.2% YoY) and EPS, mainly due to pressure on margins, higher operating expenses, and a shift in sales mix toward lower-margin segments. Cash flow has improved, the balance sheet remains healthy, and management is actively investing in expansion and operational efficiency.

Investor Guidance

If you currently hold Envictus shares: Consider holding your position if you are a long-term investor and can tolerate short-term earnings volatility. The company is expanding, cash flow is strong, and management is focused on cost controls and strategic growth. However, watch for margin recovery, improved profitability, and execution on expansion plans.
If you do not currently hold Envictus shares: It may be prudent to wait for clearer signs of earnings stabilization and margin improvement before initiating a position. Monitor upcoming results for evidence that margin pressures are easing and that new investments are translating into sustainable profit growth.

Disclaimer: This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell any security. Investors should conduct their own research and consider their own risk profile before making investment decisions.