Greetings, fellow investors and market watchers!
Ever wondered what drives the performance of companies in Malaysia’s dynamic market? Today, we’re diving deep into the latest financial report from YONG TAI BERHAD for the year ended 30 June 2025. This report presents a mixed bag of developments, showcasing growth in some areas alongside an overall net loss for the year. It’s a snapshot that reveals both the challenges faced and the strategic maneuvers underway to steer the company towards future profitability.
From promising new property ventures and the resurgence of tourism assets to ongoing legal matters, there’s a lot to unpack. Join me as we break down the numbers and strategic insights from YONG TAI’s full-year performance.
Overall Financial Performance: A Mixed Picture
YONG TAI BERHAD has navigated a challenging landscape, with the latest quarter and full financial year demonstrating a complex financial trajectory.
For the 3 months ended 30 June 2025, YONG TAI reported a revenue of RM8.28 million, a significant increase from RM5.54 million in the same quarter last year. However, the company recorded a net loss attributable to equity holders of RM11.82 million, a reversal from the RM12.55 million profit in the corresponding quarter of FY2024.
Looking at the full year ended 30 June 2025, total revenue stood at RM39.73 million, up from RM34.49 million in the previous financial year. Despite the revenue growth, the company posted an overall net loss of RM19.61 million attributable to equity holders, a stark contrast to the RM6.46 million profit recorded in FY2024. This translates to a basic loss per share of 4.58 sen for the year, compared to an earnings per share of 1.68 sen last year.
Revenue and Profit Before Taxation (PBT) Overview:
3 Months Ended 30.06.2025
Revenue: RM8,276,000
(Loss)/Profit Before Taxation: (RM13,186,000)
Net (Loss)/Profit: (RM11,822,000)
Basic (Loss)/Profit Per Share: (2.76 sen)
3 Months Ended 30.06.2024
Revenue: RM5,542,000
(Loss)/Profit Before Taxation: RM16,471,000
Net (Loss)/Profit: RM12,553,000
Basic (Loss)/Profit Per Share: 3.11 sen
12 Months Ended 30.06.2025
Revenue: RM39,729,000
(Loss)/Profit Before Taxation: (RM25,514,000)
Net (Loss)/Profit: (RM19,608,000)
Basic (Loss)/Profit Per Share: (4.58 sen)
12 Months Ended 30.06.2024
Revenue: RM34,488,000
(Loss)/Profit Before Taxation: RM8,328,000
Net (Loss)/Profit: RM6,463,000
Basic (Loss)/Profit Per Share: 1.68 sen
The transition from profit to loss for the year was primarily influenced by a significant reversal of impairment loss in the preceding year, which had inflated last year’s figures. Additionally, higher finance costs have impacted the bottom line. It’s important to look beyond just the headline numbers to understand the underlying operational shifts.
Business Unit Performance: Key Drivers and Challenges
YONG TAI operates across several segments, each contributing differently to the overall performance:
Property Development
For the quarter, revenue from property development rose to RM5.81 million from RM5.04 million in the same period last year, mainly driven by progressive revenue from the Impression U-Thant project. However, this segment reported a loss before taxation (LBT) of RM9.60 million, primarily due to a revision of cost estimation and additional provisions for liquidated ascertained damages for the Impression U-Thant project, reflecting delays.
On a full-year basis, while revenue slightly decreased to RM29.61 million (from RM32.15 million), the LBT significantly narrowed to RM13.01 million from RM45.38 million in the previous financial year. This improvement in LBT for the full year is largely due to the one-off provision for impairment loss recorded in the prior year not recurring.
Property Investment
This segment saw impressive growth, with quarterly revenue surging to RM2.47 million from RM0.50 million previously. The primary catalyst was the Encore Melaka theatre, which resumed daily shows in July 2024 and has since posted a net operating profit. Consequently, the LBT for this segment narrowed by 55% for the quarter, despite incurring interest costs and depreciation for the theatre building.
For the full year, property investment revenue soared to RM10.12 million from RM2.34 million in FY2024. The LBT also narrowed significantly by 39% to RM8.30 million, thanks to the theatre’s improved performance and the launch of a new show, “The Legacy of a Generation,” enhancing theatre utilization.
Asset Held for Sale (Courtyard by Marriott Melaka hotel)
Following its reclassification as an asset held for sale, the Courtyard by Marriott Melaka hotel continues to be a steady contributor. Improved occupancy rates in the current quarter led to an increased profit before taxation (PBT) contribution from the Hotel. On a full-year basis, the hotel continues to generate commendable revenue and profit, also benefiting from corporate events and banquets.
EBITDA Performance
The Group recorded a positive Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA) of RM7.35 million for FY2025, a notable achievement driven by the strong performance of the hotel and the Encore Melaka theatre, despite the overall net loss position.
Financial Health: Balance Sheet and Cash Flow Insights
Understanding a company’s financial health goes beyond just profit and loss. Let’s look at the balance sheet and cash flow:
Statement of Financial Position (Balance Sheet)
As at 30.06.2025
Total Assets: RM679,852,000
Total Equity: RM263,978,000
Total Liabilities: RM415,874,000
Net Assets Per Share: RM0.62
As at 30.06.2024
Total Assets: RM692,438,000
Total Equity: RM277,910,000
Total Liabilities: RM414,528,000
Net Assets Per Share: RM0.65
The Group’s total assets saw a slight decrease, with a corresponding dip in total equity. Net assets per share marginally declined from RM0.65 to RM0.62, reflecting the full-year net loss.
Cash Flow Statement
12 Months Ended 30.06.2025
Net Cash for Operating Activities: (RM24,494,000)
Net Cash for Investing Activities: (RM318,000)
Net Cash from Financing Activities: RM23,849,000
Cash and Cash Equivalents at End of Year: (RM13,532,000)
12 Months Ended 30.06.2024
Net Cash for Operating Activities: (RM19,835,000)
Net Cash for Investing Activities: (RM94,000)
Net Cash from Financing Activities: RM22,854,000
Cash and Cash Equivalents at End of Year: (RM12,615,000)
YONG TAI recorded a net cash outflow from operating activities, slightly higher than the previous year. However, net cash from financing activities remained positive, mainly from the issuance of redeemable convertible preference shares and loans and borrowings, which helped manage the cash position. Overall, cash and cash equivalents showed a net decrease.
Risks and Prospects: Charting the Path Forward
The management acknowledges that the business environment is expected to remain challenging for FY2026. However, YONG TAI has outlined several strategic initiatives to drive future growth and prudently manage its finances.
Property Development Outlook
- Impression U-Thant Project: This project is targeted for vacant possession by the first quarter of FY2026. With an unbilled revenue of RM42 million, it is expected to significantly improve the Group’s financial results in the upcoming year.
- The Dawn Project: A joint venture with Taghill Land Sdn Bhd, this project in Impression City Melaka is slated to commence construction in the fourth quarter of 2025 and complete by the fourth quarter of 2027. Upon completion, YONG TAI expects to unlock RM28 million in equity funding through landowner’s entitlement, which should enhance cash flow without further construction risk exposure.
- Sabah Expansion: The recent acquisition of Sumberjaya Builders Sdn Bhd marks YONG TAI’s entry into Sabah’s property market. With two quick turnaround landed mixed-development projects in Lahad Datu and Tawau, carrying a combined Gross Development Value of RM176.70 million and a projected development profit of RM40.58 million, this move is expected to diversify earnings and boost future profitability. Launch is targeted for the fourth quarter of 2025.
- The Group remains committed to exploring new development opportunities to ensure earnings visibility in the property sector.
Tourism Industry Resurgence
- Malaysia’s tourism industry is showing robust growth, with increasing tourist arrivals. Government initiatives, such as hosting the 19th ASEAN Ministerial Meeting on Transnational Crime and the World Tourism Conference at Melaka, along with the “Visit Malaysia 2026” campaign, position Encore Melaka theatre favorably.
- The theatre is poised to attract more local and international visitors, translating into steady ticket sales, especially with its existing show and the newly launched “The Legacy of a Generation” utilizing the theatre’s capacity more effectively.
Ongoing Corporate Proposals
YONG TAI has several corporate proposals in various stages of completion, including the issuance of Redeemable Convertible Preference Shares (RCPS), a proposed disposal of the Courtyard by Marriott Melaka hotel, and a proposed private placement. These initiatives aim to strengthen the company’s financial position, streamline assets, and secure funding for future growth.
Material Litigation
The Group is currently involved in a material litigation case with Kerjaya Prospek (M) Sdn. Bhd. (KP) concerning alleged outstanding contract sums. While KP is seeking specific performance or an alternative sum of RM105.14 million, YONG TAI’s subsidiary, Apple 99 Development Sdn. Bhd., has filed a defence and counterclaim, asserting that KP is not entitled to specific performance due to breaches and that a supplementary agreement supersedes the original. The directors believe that KP’s claims are not expected to have a material financial effect on the Group’s net assets, net assets per share, and gearing, as adequate provisions have been made. They are confident in dismissing KP’s claims and setting aside an adjudication decision.
Summary and Investment Recommendations
YONG TAI BERHAD’s latest report paints a picture of a company in transition. While the full financial year ended June 2025 saw an overall net loss, this was significantly influenced by prior-year accounting reversals and increased finance costs. Operationally, there are bright spots, particularly the strong recovery and contribution from the Encore Melaka theatre and the steady performance of the hotel (now classified as asset held for sale).
The Group’s strategic focus on unlocking value from its existing property development projects (Impression U-Thant, The Dawn) and expanding into new, high-growth markets like Sabah through the Sumberjaya Builders acquisition are key initiatives that could reshape its financial trajectory. The anticipated recovery in the Malaysian tourism sector, bolstered by government campaigns, provides a favorable tailwind for its cultural tourism assets.
However, investors should remain mindful of the ongoing challenging business environment and the significant legal dispute, even if management believes its financial impact is contained. Prudent cost control measures, as highlighted by the company, will be crucial in conserving cash flow and navigating the uncertainties ahead.
Key points from the report:
- Revenue increased for both the quarter and full year, but the company reported a net loss due to prior-year accounting adjustments and higher finance costs.
- Property Investment and Asset Held for Sale segments demonstrated positive operational momentum, particularly with Encore Melaka theatre’s recovery.
- Strategic property development projects in the pipeline (U-Thant, The Dawn, Sabah expansion) are expected to drive future revenue and profitability.
- The Group is actively pursuing corporate proposals to strengthen its financial structure and asset base.
- An ongoing material litigation with Kerjaya Prospek is a notable factor, though management asserts it will not have a material financial effect.
The coming financial year, FY2026, will be critical in observing how these strategic initiatives translate into improved financial performance and whether the company can successfully navigate its current challenges.
From a professional standpoint, YONG TAI is clearly making proactive moves to diversify its revenue streams and capitalize on opportunities within both the property and tourism sectors. The focus on quick turnaround projects in Sabah and leveraging the tourism upswing in Melaka indicates a well-thought-out strategy to improve cash flow and long-term profitability.
Do you think YONG TAI BERHAD can maintain this strategic momentum and effectively convert its unbilled revenue and new project pipelines into sustainable profits in the next few years? Share your thoughts and insights in the comment section below!
