Combine Will International Holdings Limited: FY2025 Financial Analysis

Combine Will International Holdings Limited (“Combine Will”) has released its condensed interim financial information for the six months and full financial year ended 31 December 2025. The following analysis summarizes the key financial metrics, performance trends, dividend announcements, and management commentary to provide investors with a clear understanding of the company’s recent results and outlook.

Key Financial Metrics & Performance Table

Historical Performance & Trends

Combine Will delivered robust revenue growth in FY2025, with total revenue increasing 23.1% year-on-year to HK\$1,811.0 million, mainly due to a 27% increase in order volume from key customers. Gross profit grew by 22.8%, reflecting stable operations and the ramp-up of high-margin production capacity. However, net profit declined 18.8% YoY to HK\$37.1 million due to lower other income (absence of a one-off gain from FY2024), higher administrative expenses related to new business units, and increased professional fees.

Exceptional Items and Significant Expenses

• Other income fell by 42.2% in FY2025 vs. FY2024, primarily due to a non-recurring HK\$23.4 million gain from the disposal of the Dongguan Shenshan factory in FY2024.
• Administrative expenses rose 39.4% due to expansion in Indonesia, new senior management hires, and professional consulting costs.
• Finance costs decreased by 7.2% due to lower interest rates (HIBOR) and refinancing with lower-rate banks.

Dividends

• A final dividend of SGD 5.0 cents per share has been proposed for FY2025, unchanged from FY2024.
• The dividend is subject to shareholder approval at the next AGM.

Cash Flow and Balance Sheet Review

• Net cash used in operating activities was HK\$32.4 million, reflecting higher working capital needs due to increased contract assets and inventories.
• Net cash used in investing activities was HK\$130.1 million, mainly for new land and equipment in Indonesia and Mainland China.
• Net cash generated from financing activities amounted to HK\$160.3 million, primarily from increased bank borrowings to support expansion.
• Cash and cash equivalents stood at HK\$96.9 million as of 31 December 2025, deemed adequate for operational needs.

Geographical and Segment Analysis

• Asia (including Greater China and Indonesia) contributed 98.3% of FY2025 revenue, with Europe accounting for 1.7%. Revenue from Europe surged by nearly 500%, although the absolute value remains small compared to Asia.
• All revenue is derived from the manufacture of toys and premium products, with no other segment meeting reporting thresholds.

Noteworthy Corporate Actions and Events

• No share buybacks, new shares, or dilution occurred in FY2025.
• No related party transactions of material value except for a HK\$6.1 million management fee paid to a subsidiary shareholder.
• No fundraising, IPOs, or asset sales other than the previously mentioned factory disposal in FY2024.
• Significant capital investment continued in Indonesia, with plant and equipment expansion and the start of Plush Phase 2 operations.

Chairman’s Statement and Outlook

“In FY2025, the Group delivered double-digit revenue growth of 23%, notwithstanding an increasingly complex global operating environment… The commencement of Plush Phase 2 operations in Indonesia, together with the ongoing development of the Group’s die-casting and plastic expansion projects, has enhanced its regional manufacturing platform and geographic diversification… The proportion of eco-friendly materials in the Group’s production reached a historical high level of over 77% in FY2025, exceeding the targets set in prior years and reflecting customers’ transition toward greener product offerings… Looking ahead to the next reporting period and the coming 12 months, the Group expects industry conditions to remain dynamic. Geopolitical uncertainties, shifts in global trade dynamics and labour market pressures may continue to affect operating costs and supply chain stability. At the same time, the progressive ramp-up of Indonesia operations… will further strengthen the Group’s integrated manufacturing platform… The Group will closely monitor funding and capital expenditure commitments as Indonesia expansion progresses in 2026.”

The Chairman’s tone is cautiously optimistic—highlighting operational achievements, customer diversification, sustainability leadership, but also warning of ongoing industry volatility, cost pressures, and the need for disciplined capital management.

Conclusion & Investment Recommendations

Overall, Combine Will’s FY2025 financial performance demonstrates strong revenue growth and operational expansion, offset by higher costs and one-off income effects, resulting in lower net profit. The company’s geographic diversification, especially into Indonesia, positions it well for industry trends toward multi-country sourcing and sustainability. However, working capital requirements and administrative expenses have risen, and the global macro environment remains uncertain.

Recommendation for Existing Shareholders

If you are currently holding Combine Will shares, consider maintaining your position. The company’s revenue growth and expansion into Indonesia offer medium-term opportunities, and the proposed dividend yield remains steady. However, monitor future earnings for margin stabilization and successful cost management as the group ramps up new production capacity.

Recommendation for Prospective Investors

If you are not currently holding Combine Will shares, consider a wait-and-see approach. While revenue momentum and sustainability focus are positives, the company faces near-term cost pressures, and profit margins have declined. Entry may be more attractive once there is evidence of margin recovery and improved bottom-line growth as the Indonesia expansion matures.

Disclaimer

This analysis is based solely on information disclosed in the company’s FY2025 interim and annual financial statements. It does not constitute financial advice or a recommendation to buy or sell securities. Investors should conduct their own research or seek advice from a qualified professional before making investment decisions.

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