Serial Achieva Limited FY2025 Financial Review: Growth, Restructuring, and Strategic Shifts

Serial Achieva Limited, an IT distributor and data center solutions provider listed on the Singapore Exchange Catalist Board, reported its unaudited condensed interim financial statements for the six months and full year ended 31 December 2025. The results reflect substantial revenue growth, an improving gross margin, and ongoing restructuring efforts, but also highlight persistent net losses, increased borrowings, and an uncertain operating environment.

Key Financial Metrics & Performance Table

Historical Performance Trends

• Revenue: Full-year group revenue surged 22% to US\$96.8 million (FY2025), primarily due to expansion in Thailand and continued demand in Malaysia. However, 2H2025 revenue fell 21% YoY, primarily due to the closure of the 55%-owned Singapore subsidiary, Achieva Tech Allianz Pte. Ltd.
• Gross Profit Margin: Improved to 3.0% from 2.1% last year, driven by better product mix and higher-margin categories.
• Net Loss: Narrowed sharply to US\$0.7 million from US\$6.1 million last year. Last year’s numbers included a US\$4.6 million one-off loss relating to a reverse takeover and introducer fee paid in shares, not repeated this year.
• Operating Cash Flow: Strong positive cash flow of US\$8.7 million, mainly due to reductions in receivables and inventories.
• Borrowings: Increased substantially to US\$25.1 million from US\$6.0 million, reflecting new lease liabilities for data center expansion and higher working capital needs.

Exceptional Items & Corporate Actions

• One-off Exceptional Items (2024): FY2024 results were impacted by a US\$4.2 million loss from a reverse takeover and a US\$0.4 million introducer fee paid in shares.
• Closure of Singapore Subsidiary: Achieva Tech Allianz Pte. Ltd. was struck off in December 2025, with return of paid-up capital to shareholders.
• New Ventures: The group incorporated a Malaysia co-location subsidiary and entered a joint venture in Vietnam (49% stake) to expand IT distribution presence in the region.
• Share Capital Actions: No new shares issued in 2025; last significant placements and share issues were associated with the reverse takeover and compliance placement in 2024.

Dividends

• No dividends declared for FY2025 or FY2024 due to accumulated losses and negative retained earnings position.

Related-Party Transactions & Fund Flows

• Significant related-party transactions continued with Serial System Ltd (holding company) and its subsidiaries, mainly in purchases and sales of goods, and management fees. These are under general mandate and disclosed as required.

Balance Sheet and Cash Flow Observations

• Receivables and Inventories: Both decreased substantially, reflecting improved working capital management and the effect of business closure in Singapore.
• Lease Receivables and Liabilities: New three-year non-cancellable finance lease agreement (Malaysia) led to significant recognition of both finance lease receivables and lease liabilities.
• Gearing Ratio: Jumped to negative 15% (excluding secured lease liabilities), due to new lease recognition and higher borrowings for working capital and business expansion.
• Cash Position: Cash and equivalents at US\$7.5 million (group), with S\$1.3 million pledged as security for lease liabilities.

Forecasts, Risks & Outlook

• Outlook for 2026: Management expects operating conditions to remain challenging, citing cautious consumer sentiment and possible pricing pressure from memory shortages. Strategic focus remains on innovation (gaming, cloud, AI), regional expansion, and operational efficiency.
• Risk Factors: Currency volatility, supply chain disruptions, and trade restrictions are specifically mentioned as risks to be actively managed.

Chairman’s Statement

The report does not present a full Chairman’s Statement, but the CEO (Victoria Goh Si Hui) closes with a future-oriented, cautiously optimistic note emphasizing strengthening capabilities and creating opportunities, while remaining vigilant on external risks and disciplined in management.

Tone: Neutral to cautiously positive, focused on resilience and diversification rather than outright growth optimism.

Conclusion & Investment Recommendations

Overall Assessment

Serial Achieva Limited delivered improved operational results in FY2025, with higher revenue, better gross margins, and sharply reduced net losses compared to the prior year. However, the group remains loss-making, has accumulated losses, and faces an increase in gearing due to new lease liabilities and working capital borrowings. The business restructuring, closure of its Singapore subsidiary, and expansion into new regional markets mark the group’s strategic pivot, but the near-term outlook remains challenging with management warning of macroeconomic and industry headwinds.

Investor Recommendations

• If you are currently holding this stock:
  • Maintain a cautious stance. The company has moved past one-off exceptional losses and is showing improving operational metrics, but persistent net losses, no dividend, and increased leverage warrant prudence.
  • If you are a long-term investor, monitor execution of the regional expansion, new business lines, and management’s ability to return to sustained profitability. Consider reducing exposure if losses persist or leverage increases further without clear returns.
• If you are not currently holding this stock:
  • Consider staying on the sidelines for now. Wait for evidence of consistent profitability, positive free cash flow, and reduction in gearing before initiating any position. The group’s successful restructuring and regional expansion could provide upside, but risks remain elevated in the near-term.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence or consult a professional advisor before making investment decisions. The analysis is based strictly on the company’s reported financials as at 31 December 2025.

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