Verdant Solar Holdings Berhad Q3 2026 Interim Financial Report: Key Insights for Investors
Executive Summary
Verdant Solar Holdings Berhad (“Verdant Solar” or “the Group”) has published its unaudited interim financial report for the third quarter ended 31 March 2026. This is the first set of quarterly results released since its listing on the ACE Market of Bursa Malaysia Securities Berhad on 22 October 2025.
Key Financial Highlights
- Revenue: RM8.77 million for the quarter, up 29.54% from the immediate preceding quarter (RM6.77 million).
- Gross Profit: RM2.47 million, up 17.33% from the previous quarter.
- Gross Profit Margin: 28.11% for the quarter, down from 31.03% previously due to changes in project mix, especially a higher proportion of Battery Energy Storage System (BESS) installations.
- Loss Before Tax (LBT): RM2.24 million, a significant improvement from RM5.45 million in the previous quarter, reflecting a 58.89% reduction in losses.
- Loss After Tax (LAT): RM1.98 million, improving from a loss of RM4.68 million in the previous quarter.
- Adjusted Loss Before Tax (excluding non-recurring listing expenses): RM0.98 million for the cumulative 9-month period.
- Net Assets Per Share: RM0.07 as at 31 March 2026.
- Cash and Cash Equivalents: RM48.07 million, up from RM25.68 million as at 30 June 2025, mainly attributed to IPO proceeds.
Operational and Business Developments
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Revenue Mix:
- 97.61% from Engineering, Procurement, Construction, and Commissioning (EPCC) services for solar photovoltaic (PV) systems.
- 2.39% from Operations & Maintenance (O&M) services.
- EPCC Services as Key Driver: For the 9-month financial year-to-date, revenue reached RM39.48 million, with 98.07% from EPCC solar PV systems.
- Project Mix Impact: The quarter saw an increased share of BESS projects, which typically have lower margins, leading to a slight compression in gross profit margin.
- Seasonality: The company noted lower sales during traditional festive periods such as Chinese New Year and Hari Raya Aidilfitri, but otherwise business was not affected by seasonality.
- One-off Listing Expenses: Non-recurring listing expenses of RM2.47 million were recorded, impacting the bottom line. Adjusted LBT for the 9-month period is RM0.98 million if these are excluded.
Balance Sheet and Cash Flow
- Total Assets: RM83.44 million as at 31 March 2026, up from RM50.78 million as at 30 June 2025.
- Equity Position: Total equity increased to RM56.26 million from RM21.93 million, driven mainly by new shares issued under the restructuring and IPO.
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IPO Proceeds Utilisation:
- Gross proceeds of RM44.02 million raised.
- Key allocations (unutilised balance RM27.32 million as at 8 May 2026):
- Establishment of branch offices: RM13.85 million remaining
- Expansion via strategic investments/M&A: RM10.00 million unutilised
- Enhancement of digital infrastructure: RM3.48 million unutilised
- Working capital: Fully utilized
- Listing expenses: Fully utilized
- Unutilised proceeds placed in licensed financial institutions and short-term money market instruments to earn interest income.
- Loans and Borrowings: RM696,000 outstanding (secured by government and corporate guarantees), with no material change in leverage post-IPO.
- Capital Commitments: RM1.09 million committed for renovations for new HQ and branch offices.
Strategic and Regulatory Developments
- Solar ATAP Policy: The government’s Solar Accelerated Transition Action Programme (Solar ATAP), introduced in January 2026, is expected to expand the addressable market for residential rooftop solar, which is a key focus for Verdant Solar. The Group’s growth is supported by this policy tailwind.
- Insurance Partnership: Verdant Solar has partnered with Tune Insurance Malaysia Berhad to launch Malaysia’s first integrated solar and protection model, embedding insurance into residential solar packages. This is expected to boost customer confidence and conversion rates.
- Expansion Plans: The Group is executing on plans to scale up EPCC capabilities, improve operational efficiency, and expand its geographic footprint across Peninsular Malaysia.
- Segment Focus: Revenue, profit, assets, and liabilities are mainly from the solar EPCC and O&M segment; no other material business segments reported.
Other Noteworthy Items
- No Dividend Declared: No dividend has been declared or recommended for payment for this quarter. However, a pre-IPO interim dividend of RM5.0 million was paid on 18 August 2025.
- No Material Litigation or Contingencies: The Group is not subject to any material litigation or contingent liabilities as at the reporting date.
- No Changes in Group Structure: There were no acquisitions, disposals, or changes in group composition during the period.
- Tax: The Group recognised a tax reversal of RM0.25 million in the quarter, mainly due to reversals from the preceding quarter’s losses. Effective tax rate is not meaningful due to net loss position.
- Related Party Transactions: Minimal related party transactions, with RM31,000 in sales to a company related to shareholders’ family members.
Prospects and Outlook
The Group is optimistic about its outlook, supported by strong policy drivers, robust industry tailwinds, and strategic initiatives. The Solar ATAP policy, rising electricity tariffs, and increasing renewable energy adoption are expected to drive demand for rooftop solar and BESS projects. Verdant Solar’s integrated solutions, growing order book, and new insurance-linked offerings position it well for accelerated growth and higher-value projects. The Group aims to sustain growth through continued investment in EPCC capabilities, digital infrastructure, geographic expansion, and strategic partnerships.
Potential Price-Sensitive Information for Shareholders
- IPO Proceeds and Expansion Plans: The Group retains a significant cash balance from its IPO, with clear plans for expansion through new branches, M&A, and digital infrastructure. Success or delay in deploying these funds could materially impact growth prospects and valuation.
- Solar ATAP Policy: The implementation of Solar ATAP presents a major growth catalyst for the Group, particularly in the residential segment. Any changes in government policy or programme effectiveness could affect the Group’s future performance.
- Margin Compression Risk: The shift towards BESS and mixed project types is resulting in lower margins in the short term. Future margin trends will depend on project mix and execution efficiency.
- Insurance Partnership: The unique insurance-linked solar packages could drive higher sales conversion and customer acquisition, potentially leading to upside surprises in future results.
- Non-Recurring Expenses: The current period’s losses are significantly affected by one-off listing expenses. Excluding these, the Group’s adjusted loss is much smaller, indicating underlying business improvement.
Conclusion
Verdant Solar’s Q3 2026 report signals a company transitioning towards growth, backed by a strong cash position, supportive regulatory landscape, and strategic initiatives targeting both residential and commercial solar markets. Investors should monitor the pace of capital deployment, execution of expansion plans, and regulatory developments, as these will be critical to the Group’s future performance and share price trajectory.
Disclaimer: This article is provided for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should conduct their own research or consult their financial advisors before making investment decisions.
