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EITA RESOURCES BERHAD: Navigating Growth Amidst Shifting Tides – Q2 FY2025 Performance Review
EITA RESOURCES BERHAD (Company No.: 199601026396 (398748-T)) has just released its interim financial report for the quarter ended 31 March 2025. This report offers a crucial glimpse into the company’s operational health and strategic direction as it navigates a dynamic economic landscape.
The headline figures are certainly eye-catching: a remarkable surge in profit for the current quarter and a solid increase year-to-date. Furthermore, the Board has announced a higher interim dividend, signaling confidence in its performance and commitment to shareholder returns. But beyond these impressive numbers, what truly drives EITA’s performance, and what challenges lie ahead?
Core Financial Highlights: A Quarter of Significant Profit Growth
EITA RESOURCES BERHAD demonstrated a robust turnaround in profitability for the quarter ended 31 March 2025. Let’s dive into the key figures:
Quarter-on-Quarter Performance (Q31.03.2025 vs Q31.03.2024)
Current Quarter (31.03.2025)
Revenue: RM89,088,000
Profit Before Tax (PBT): RM4,408,000
Profit for the Period (Net Profit): RM2,465,000
Profit Attributable to Owners: RM3,444,000
Basic Earnings Per Share (EPS): 1.14 sen
Same Quarter Last Year (31.03.2024)
Revenue: RM85,142,000 (+4.6%)
Profit Before Tax (PBT): RM1,701,000 (+159.1%)
Profit for the Period (Net Profit): (RM202,000) (+1,320.3%)
Profit Attributable to Owners: RM1,671,000 (+106.1%)
Basic Earnings Per Share (EPS): 0.58 sen (+96.6%)
The Group’s revenue saw a modest increase of 4.6% to RM89.1 million compared to the corresponding quarter last year, primarily driven by stronger performance in the High Voltage System and Manufacturing segments. However, the standout figure is the Profit Before Tax (PBT), which surged by an impressive 159.1% to RM4.4 million. This significant jump was mainly attributed to reduced losses in the High Voltage System and Manufacturing segments, coupled with higher PBT from Marketing and Distribution.
Year-to-Date Performance (6 Months Ended 31.03.2025 vs 31.03.2024)
Current YTD (31.03.2025)
Revenue: RM194,473,000
Profit Before Tax (PBT): RM15,423,000
Profit for the Period (Net Profit): RM11,104,000
Profit Attributable to Owners: RM12,799,000
Basic Earnings Per Share (EPS): 4.24 sen
Previous YTD (31.03.2024)
Revenue: RM199,759,000 (-2.6%)
Profit Before Tax (PBT): RM11,726,000 (+31.5%)
Profit for the Period (Net Profit): RM7,925,000 (+40.1%)
Profit Attributable to Owners: RM9,161,000 (+39.7%)
Basic Earnings Per Share (EPS): 3.34 sen (+26.9%)
Cumulatively, while revenue saw a slight dip of 2.6% due to lower contributions from the High Voltage System segment, the Group’s PBT still managed to grow by a healthy 31.5% to RM15.4 million. This was primarily driven by improved profitability in the Manufacturing and Marketing & Distribution segments.
Quarter-on-Quarter Performance (Q31.03.2025 vs Q31.12.2024)
Current Quarter (31.03.2025)
Revenue: RM89,088,000
Profit Before Tax (PBT): RM4,408,000
Profit for the Period (Net Profit): RM2,465,000
Profit Attributable to Owners: RM3,444,000
Basic Earnings Per Share (EPS): 1.14 sen
Preceding Quarter (31.12.2024)
Revenue: RM105,385,000 (-15.5%)
Profit Before Tax (PBT): RM11,015,000 (-60.0%)
Profit for the Period (Net Profit): RM8,639,000 (-71.5%)
Profit Attributable to Owners: RM9,355,000 (-63.2%)
Basic Earnings Per Share (EPS): 3.10 sen (-63.2%)
When comparing the current quarter to the immediate preceding quarter (Q31.12.2024), there was a notable decrease in both revenue (-15.5%) and PBT (-60.0%). This decline was broad-based across all segments, indicating a slower pace of business activity in the most recent quarter compared to the previous one.
Segmental Performance Analysis (YTD 31.03.2025 vs 31.03.2024)
Understanding the contribution of each business segment provides deeper insights:
| Segment | Revenue (RM’000) | Revenue Change (%) | PBT (RM’000) | PBT Change (%) |
|---|---|---|---|---|
| Marketing and Distribution | 47,817 | +10.9% | 7,164 | +42.1% |
| Manufacturing | 82,078 | +17.3% | 3,095 | +601.6% |
| Services | 28,084 | +3.8% | 8,286 | -15.5% |
| High Voltage System | 36,494 | -38.8% | (3,122) | -24.6% |
- Marketing and Distribution: Saw healthy growth in both revenue (+10.9%) and PBT (+42.1%) year-to-date, largely due to higher revenue from Power and Control businesses, and improved fair value gains on derivatives.
- Manufacturing: A remarkable turnaround, with cumulative PBT of RM3.1 million compared to a loss of RM0.6 million in the prior year. This was fueled by a 17.3% revenue increase, particularly from the Elevator business, higher margins for elevator projects, and lower administrative expenses.
- Services: Experienced a modest revenue increase (+3.8%) but a decline in PBT (-15.5%) due to higher administrative expenses, despite increased sales from the Extra Low Voltage (ELV) business.
- High Voltage System: This segment faced headwinds, with cumulative revenue decreasing by 38.8% and losses before tax increasing by 24.6% to RM3.1 million. This was primarily due to lower execution of Transmission Sub-Station projects in Peninsular Malaysia and higher net loss on foreign exchange.
Financial Position and Cash Flow
As of 31 March 2025, EITA’s total assets stood at RM403.6 million, a slight increase from RM402.9 million at 30 September 2024. Total equity attributable to owners of the company increased to RM255.1 million from RM245.0 million, reflecting the retained profits. Net assets per share improved to RM0.85 from RM0.81.
However, the cash flow statement indicates a shift: the Group recorded net cash used in operating activities of RM5.06 million for the six months ended 31 March 2025, compared to net cash generated of RM2.19 million in the same period last year. This change was largely influenced by working capital movements, particularly in trade and other receivables.
Risks and Prospects: Navigating Macroeconomic Headwinds
The Malaysian economic outlook remains a key consideration. While the government initially projected a GDP growth of 4.5% to 5.5% for 2025, this forecast faces potential revision due to the impact of reciprocal tariffs imposed by the United States. The Finance Ministry and Bank Negara Malaysia are actively assessing these impacts to provide a more certain outlook.
On a brighter note, the temporary lowering of tariffs between the United States and China, effective May 14, 2025, offers a glimmer of hope for reduced global trade tensions. This could potentially ease supply chain pressures and improve the overall business environment.
EITA Resources Berhad acknowledges the need for vigilance regarding external environmental changes. Despite the macroeconomic uncertainties, the Board remains cautiously optimistic about the Group’s financial performance for the upcoming quarter ending 30 June 2025, supported by its current order book and ongoing projects. This suggests that while external factors are being monitored, the company has a foundation of existing business to sustain its operations in the near term.
Summary and Outlook
EITA RESOURCES BERHAD has delivered a strong profit recovery in the latest quarter, largely driven by improved performance in its Manufacturing and Marketing & Distribution segments, alongside a reduction in losses from the High Voltage System segment. The announcement of a higher interim dividend further underscores the company’s commitment to delivering shareholder value.
While the overall financial performance in terms of profit is commendable, especially the significant turnaround in the Manufacturing segment, the Group’s cash flow from operations has turned negative. This, coupled with the cumulative revenue decline and the increased losses in the High Voltage System segment year-to-date, suggests that the company is operating in a complex environment where profitability drivers differ across segments.
Looking ahead, the macroeconomic landscape presents both opportunities and challenges. The potential impact of global trade policies on Malaysia’s GDP growth requires careful monitoring. However, EITA’s existing order book provides a degree of stability, allowing for cautious optimism.
Key points to consider moving forward:
- The sustainability of the Manufacturing segment’s profit turnaround and its ability to offset losses from other segments.
- The Group’s strategy to address the negative cash flow from operating activities and manage working capital effectively.
- The performance trajectory of the High Voltage System segment and plans to mitigate its losses.
- The broader impact of global trade tariffs and domestic economic policies on EITA’s overall business environment.
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