NORDIC GROUP LIMITED: FY2025 Financial Results Analysis

Nordic Group Limited, a diversified engineering group listed on the Singapore Exchange, released its condensed consolidated financial statements for the second half and full year ended 31 December 2025. This article presents a structured analysis of key financial metrics, performance trends, dividend policy, and outlook, with actionable recommendations for investors.

Key Financial Metrics

Historical Performance Trends

• Revenue for FY2025 decreased 3% YoY to \$153.3m from \$158.4m, mainly due to fewer project deliveries. However, maintenance services revenue grew 9% YoY, offsetting the decline in project services.
• Gross profit increased 10% YoY to \$40.5m, with gross margins rising from 23.2% to 26.4% due to reversal of contingency costs and greater use of internal resources.
• Net profit grew 9% YoY to \$19.0m, supported by improved gross margins and lower finance costs.
• EPS for the year rose from 4.4c to 4.8c (+9%).
• Dividend payout increased 9% YoY to 1.9021c per share.

Dividends

• The Board has recommended a final dividend of 1.0745 cents per share, subject to shareholder approval, following an interim dividend of 0.8276 cents per share paid earlier in the year.
• Total annual dividend for FY2025 is 1.9021 cents per share, up from 1.7513 cents per share in FY2024.

Other Notable Corporate Actions

• Share buybacks continued, with the company holding 1,733,100 treasury shares (0.43% of issued shares) at year-end. No dilution or convertible issuance was reported.
• No interested person transactions above \$100,000 occurred during the year.
• Two new subsidiaries were incorporated: Avitools (Thailand) Co., Ltd and Envipure (India) Private Limited, expanding the group’s regional footprint.

Exceptional Earnings and Expenses

• Reversal of trade receivable impairment and lower inventory impairment contributed positively to other income.
• Finance costs decreased sharply due to lower borrowings and interest rates.
• Foreign exchange losses were reported in FY2025, mainly due to USD weakness versus SGD.

Chairman’s Statement

“As at 31 December 2025, the Group maintained a robust orderbook of S\$201.9 million, comprising S\$66.0 million from Project Services and S\$135.9 million from Maintenance Services. The deliveries for these orders are expected to be fulfilled mainly over the next 36 months, though they remain subject to possible rescheduling, variation, or cancellation by customers.
Leveraging its core engineering capabilities, the Group has established strong footprint across marine, semiconductor, and defence industries which continue to exhibit favourable structural growth trends…
While geopolitical tensions, inflationary pressures and currency volatility will continue to present near-term challenges, the Group remains optimistic on its long-term prospects and is positioning itself to capture industry tailwinds across its key addressable sectors.”

The tone of the Chairman’s statement is positive, emphasizing structural growth trends and a robust orderbook, while acknowledging near-term challenges.

Forward-Looking Commentary

• Orderbook remains healthy at S\$201.9m, to be delivered over the next 36 months.
• Structural industry trends in marine, semiconductor, and defence sectors are expected to drive long-term growth.
• Maintenance services segment is expected to provide earnings resilience.
• Risks include geopolitical tensions, inflation, and currency volatility.

Conclusion & Recommendations

Overall Financial Performance: Nordic Group’s FY2025 results reflect resilient profitability and strong cash generation despite modest revenue decline. Improved gross margins, rising dividend payouts, steady EPS growth, and a robust orderbook underscore a positive outlook, especially as maintenance services increase as a share of revenue.

Recommendation for Current Shareholders: Given the company’s positive outlook, improved profitability, stable dividends, and healthy orderbook, investors currently holding the stock may consider maintaining their positions, particularly if seeking exposure to engineering solutions and maintenance services in structurally growing sectors.

Recommendation for Prospective Investors: For those not currently holding Nordic Group shares, the stock presents an attractive opportunity based on its earnings resilience, dividend growth, and exposure to marine, semiconductor, and defence industry tailwinds. However, new investors should monitor sector risks and macroeconomic uncertainties before entry.

Disclaimer: This analysis is based strictly on information contained in the company’s official financial report. It does not constitute investment advice. Investors should conduct their own due diligence and consider their risk tolerance before making any investment decisions.

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