Progressive Impact Corporation Berhad (PICORP): Key Investor Updates from Shareholder Circular

Major Proposals to be Tabled at 34^th AGM

Progressive Impact Corporation Berhad (“PICORP”) has released a comprehensive circular to shareholders, detailing two crucial proposals that will be tabled as Special Business at the upcoming 34^th Annual General Meeting (AGM) on 24 June 2026. These proposals, if approved, could have significant implications for the company’s operations, governance, and share price.

1. Proposed Renewal of Shareholders’ Mandate for Recurrent Related Party Transactions (RRPT)

Key Highlights:

• Nature and Purpose: The Group seeks to renew its authority to enter into recurrent related party transactions (RRPTs) of a revenue or trading nature that are necessary for its day-to-day operations.
• Scope: The mandate covers a wide range of transactions, including provision of corporate and support services, rental of office space, environmental services, project management, laboratory services, sales agency services, engineering services, supply of water and corrosion treatment technologies, and the sale of lubricants and related products.
• Related Parties Involved: The main related parties include ZSB Holdings Sdn Bhd (ZSBH) Group, PITECH Group, Foxboro (M) Sdn Bhd, Untung Aquaculture Sdn Bhd, PICorr, and Intelligent Aqua, among others. Several directors and major shareholders, such as Zaid, Zaidah, Usamah, Fatimah Zahrah, and Johar, have direct or indirect interests in these entities.
• Estimated Transaction Values: The estimated values for transactions are substantial, some reaching up to RM100 million (e.g., reselling water treatment technology with Intelligent Aqua). Other transactions, like the provision of environmental and support services, range from RM1 million to RM30 million.
• Procedures and Safeguards: PICORP has outlined procedures to ensure transactions are conducted at arm’s length, on normal commercial terms, and are not detrimental to minority shareholders. These include price benchmarking, Audit Committee oversight, and abstention from voting by interested parties.
• Outstanding Receivables: Notably, as of 31 December 2025, ZSBH Group owed PICORP Group RM1,956,357, recently reduced to RM1,677,787. The board believes these amounts are recoverable and is monitoring repayments.
• Shareholder Impact: All interested directors and major shareholders will abstain from voting on the resolution. The mandate, if approved, will remain effective until the next AGM and requires annual renewal.

Potential Price-Sensitive Issues:

• Material size of transactions with related parties – up to RM100 million. This scale of RRPTs could materially impact the company’s earnings and financial position.
• Outstanding amounts from related parties – Delayed collections could affect cash flow if not managed prudently, although the board is confident of recovery.
• Governance and transparency risks – As a significant portion of PICORP’s business is transacted with related entities, investors should monitor for any future governance issues.

2. Proposed Renewal of Authority for Share Buy-Back (SBB Mandate)

Key Highlights:

• Scope: The company seeks approval to buy back up to 10% of its issued shares (maximum 65,800,000 shares based on current capital), whenever deemed appropriate, using retained profits and/or borrowings.
• Current Financial Position: As of 31 December 2025, PICORP reported accumulated losses of RM31.1 million. Share buy-backs will only occur if and when the company returns to positive retained profits.
• Treatment of Repurchased Shares: Shares can be cancelled or retained as treasury shares, which may be resold, transferred for employee share schemes, distributed as dividends, or used as purchase consideration.
• Impact on Share Capital: If the full mandate is exercised and all shares are cancelled, outstanding shares would reduce from 658 million to 592.2 million, potentially increasing EPS and improving share price performance.
• Effect on Public Shareholding Spread: Full buy-back would reduce public shareholding from 50.44% to 45.15%, still above the 25% minimum required by Bursa Malaysia.
• Share Price Control: Purchases can be made at up to 15% above the 5-day weighted average price; resales must be at or above the 5-day average, or up to 5% below, but not below cost if resold within 30 days.
• Regulatory Compliance: The company undertakes not to trigger a mandatory general offer under the Malaysian Code on Take-Overs and Mergers. If the threshold is approached, relevant exemptions will be sought.
• No Purchases in Past 12 Months: PICORP has not bought back, resold, or cancelled any shares in the previous 12 months and currently holds 2,628,900 treasury shares.
• Directors’ and Major Shareholders’ Interests: No directors or major shareholders will benefit other than the proportional increase in their shareholding percentage should the buy-back proceed.

Potential Price-Sensitive Issues:

• Buy-back Authority: If exercised, the buy-back could support the share price, especially if shares are undervalued, and improve key financial ratios such as earnings per share (EPS).
• Financial Position: Given current accumulated losses, the buy-back will only proceed if and when the company returns to profitability, which is a key signal for investors.
• Dividend Policy: No dividend was proposed for FY2025; share buy-backs could, however, enable future share dividends if treasury shares are distributed.

Additional Important Information for Shareholders

• AGM Details: The 34^th AGM will be held at Velocity Room, Ground Floor, Mercu PICORP, Lot 10, Jalan Astaka U8/84, Bukit Jelutong, 40150 Shah Alam, Selangor Darul Ehsan, Malaysia, on Wednesday, 24 June 2026, at 10.00 a.m.
• Proxy Voting: Shareholders unable to attend may appoint proxies. Proxy forms must be submitted at least 48 hours before the AGM.
• Inspection of Documents: Investors can inspect the company’s constitution, audited accounts for 2024 and 2025, and (if available) unaudited results for Q1 2026 at the company’s registered office.
• Directors’ Responsibility: The board of directors accepts responsibility for the accuracy of the statements in the circular. There are currently no material litigation, claims, or arbitration affecting the company.

Market Price History

Over the past 12 months, PICORP shares traded between RM0.020 and RM0.055. As of the latest practicable date, the price was RM0.035 per share.

Investor Takeaways

• The renewal of the RRPT mandate and the SBB mandate are both significant corporate actions that could have a material impact on PICORP’s earnings, cash flows, and share price.
• Large-scale related party transactions, if not managed prudently, could attract regulatory scrutiny or impact investor sentiment.
• The share buy-back, if executed, could support the share price, but execution depends on the company’s return to profitability.
• Shareholders should monitor for any future changes in the company’s financial performance, governance practices, and the execution of these mandates.

Disclaimer: This article is prepared for informational purposes only and does not constitute investment advice. Investors are urged to read the full shareholder circular and consult with their financial advisors before making any investment decisions. The company’s future performance may be influenced by a range of business, regulatory, and market factors. No responsibility is accepted for any actions taken based on this summary.

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