Financial Analysis Report: Aztech Group (Net Profit Decline of 90.6%)
Date of Report: 15 April 2025 Financial Year: 1Q FY2025
Business Description
Aztech Group is a company that provides smarter solutions, delighting people with its products and services. The company’s core business operations involve the design, manufacture, and distribution of IoT devices and data-communication products.
Industry Position and Competitors
The report does not provide detailed information on the company’s position within the industry, its competitors, and its market share. However, it mentions that the company is focusing on strengthening its customer base, maintaining a well-diversified supplier network, and leveraging its manufacturing footprint in Malaysia and China.
Revenue Streams and Customer Base
The company’s revenue streams come from the sale of IoT devices and data-communication products. The report mentions that revenue declined to $42 million due to reduced customer demand in the quarter. The customer base includes consumers, health-tech, and industrial segments.
Financial Analysis
Income Statement
Revenue: $42 million (down 67.3% from 1Q FY2024)
Net Profit: $1.5 million (down 90.6% from 1Q FY2024)
Net Profit Margin: 3.6%
Basic EPS: 0.20 cents (down 90.3% from 1Q FY2024)
Balance Sheet
Cash and Bank Balances: $239.1 million
Short-term Investments: $92.0 million
Net Cash Position: $315.7 million
Total Equity: $339.7 million
Cash Flow Statement
Net Cash Generated from Operating Activities: $18.6 million
Free Cash Flow: $18.3 million
Key Findings
The company’s net profit declined significantly by 90.6% to $1.5 million.
Revenue declined by 67.3% to $42 million due to reduced customer demand.
The company generated a positive cash flow from operating activities and has a strong net cash position.
The company is focusing on strengthening its customer base, maintaining a well-diversified supplier network, and leveraging its manufacturing footprint.
Important Information for Investor Action
Dividend: The report mentions a cash dividend payable of $77.2 million on 29 April 2025.
Earnings: The company’s net profit margin declined to 3.6%.
Special Activities or Actions
The company is positioning its Malaysia facility to expand its customer base and improve productivity.
The company is focusing on cost management, cash management, and capital management.
Recommendation
For current investors: Hold the stock, but be cautious of the significant decline in net profit and revenue. The company’s strong net cash position and positive cash flow from operating activities are positives.
For potential investors: Avoid investing in the stock for now, given the significant decline in net profit and revenue. However, if you believe in the company’s strategy and growth potential, you may consider investing at a lower price.
Disclaimer: This recommendation is based solely on the information provided in the report and may not reflect the current market situation. Investors should do their own research and consult with financial advisors before making any investment decisions.
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