AJJ Medtech Holdings Limited: Detailed Responses to Investor Queries on FY2025 Annual Report

Key Highlights

• Revenue Growth: FY2025 revenue surged by 37.4% to S\$3.19 million, with gross profit rising to S\$1.17 million. However, the Group continued to report a loss after tax of S\$(2.93) million.
• Strategic Transformation: FY2025 marks the fifth year since AJJ Medtech began its shift to a healthcare technology platform, focusing on intelligent care robotics, renal care, and digital healthcare as its main growth pillars.
• Order Book Strength: The Group has an order book of approximately S\$8 million, backed by multi-year supply agreements with key healthcare institutions. This provides medium-term revenue visibility and diversification, as no single client dominates.
• Material Financial Reporting Issues: For two consecutive years, the company has reported material discrepancies between unaudited and audited financial statements, including classification of liabilities, cash flow presentation, and related party balances.
• Employee Salary Deferrals: Accrued unpaid salaries totaling S\$132,000 as at year end (S\$99,000 outstanding post-year end), mainly affecting senior management. This is a potential breach of the Employment Act, but no claims or penalties have been reported to date.

Detailed Developments

Intelligent Eldercare Robotics: HIT-1 Platform

AJJ Medtech has partnered with Huaxi Intelligent Technology, selected after a thorough evaluation for its strong track record in deploying humanoid robots in eldercare settings. Huaxi has secured over 1,000 pre-orders for its first-generation robot, with production capacity exceeding 100 units per month, mainly deployed in China. The robot is capable of mobility assistance, monitoring, workflow augmentation, and reliable operation in institutional environments.

The HIT-1 robot has achieved HSA Class A registration in Singapore, demonstrating regulatory compliance. AJJ Medtech is now focusing on localizing the robot for Singapore, integrating it into healthcare workflows, and preparing for pilot deployments. Commercial strategies under review include leasing, subscription, and bundled offerings – all aimed at establishing recurring revenue streams and strengthening institutional partnerships.

Shareholder Note: The robot is not yet deployed in Singapore, but the company may showcase it to shareholders when operational readiness is achieved. This is a significant step towards innovative solutions for manpower-constrained care environments – a potentially price-sensitive development if commercial success follows.

Renal Care Segment

AJJ Medtech’s value proposition centers on supplying dialyzers and consumables for haemodialysis. These high-frequency, essential items create steady recurring revenue. Although policy shifts favor peritoneal dialysis (PD), management believes that overall demand for renal care will remain strong due to Singapore’s aging population and rising chronic kidney disease rates. Haemodialysis will continue to be clinically necessary for many patients, ensuring dialyzer demand remains stable.

Shareholder Note: The Group’s focus on essential consumables in haemodialysis insulates it from short-term shifts in treatment mix, supporting future revenue stability.

Order Book and Revenue Visibility

The S\$8 million order book includes multi-year contracts for medical consumables, mainly with public and private healthcare providers and government agencies. Contracts typically span 3-5 years and are diversified across clients and products. Revenue is recognized progressively as goods are delivered and obligations fulfilled.

The bulk of the order book relates to non-discretionary consumables, underpinning recurring demand and revenue predictability. Commercial sensitivities limit detailed disclosure, but the company assures shareholders that these contracts reflect genuine demand and a solid foundation for growth.

Shareholder Note: The order book’s size and structure provide medium-term visibility and resilience, which may positively impact share valuation if execution continues as planned.

Financial Reporting Discrepancies

Two consecutive years of material discrepancies between unaudited and audited accounts have raised governance concerns. Issues include:

• Liabilities initially classified as non-current later reclassified as current, due to deferral agreements being executed only after year-end.
• Cash flow presentation differences, with factoring and director loan transactions reported gross in audited statements for clarity.

These discrepancies are attributed to a lean and evolving finance team and process limitations. The Audit Committee (AC) has advised strengthening financial reporting, especially for judgemental areas, and will enhance oversight going forward. Improvements include technical SFRS(I) training, additional resources, and stricter review mechanisms.

Shareholder Note: Persistent reporting issues may be price-sensitive, as they affect investor confidence in governance and financial transparency. The company is taking steps to address these concerns.

Employee Salary Deferrals & Employment Act Compliance

Accrued unpaid wages of S\$132,000 as at December 2025 mainly affect senior management, not rank-and-file employees. The deferment was mutually agreed as a cash flow management measure. Post-year end, S\$33,000 has been paid, leaving S\$99,000 outstanding. The company aims to settle this as soon as practicable and has not received any claims or penalties. The Board is reinforcing cash flow controls and compliance with employment laws, and expects additional contract inflows to support liquidity.

Shareholder Note: While currently non-material, unresolved salary payment delays and potential regulatory breaches could impact reputation and future business continuity, making this a price-sensitive issue if not fully addressed.

Management Initiatives & Outlook

• Strengthening finance and reporting functions with more resources and technical training
• Enhanced Audit Committee oversight and quality control
• Reinforced cash flow and working capital management
• Active capital planning and pursuit of new contracts to support liquidity and growth
• Commitment to compliance and employee welfare

Potential Share Price Movers

• Successful deployment and commercialization of the HIT-1 eldercare robot in Singapore
• Execution of the S\$8 million order book and expansion of institutional contracts
• Resolution of financial reporting and governance issues, restoring investor confidence
• Timely settlement of employee salary deferrals and full compliance with regulations
• Effective liquidity and capital planning amid ongoing losses

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should review official company disclosures and consult professional advisors before making investment decisions. The information herein is based on AJJ Medtech Holdings Limited’s FY2025 Annual Report and responses to investor queries, and may be subject to change or further clarification.

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