EVD BERHAD’s Q3 FY2025: Navigating Growth Amidst Strategic Shifts
Hello fellow Malaysian retail investors! EVD BERHAD, a company at the forefront of integrated engineering solutions, has just released its unaudited financial results for the third quarter ended 31 March 2025. This report offers a glimpse into the company’s performance and strategic direction as it navigates a dynamic market landscape.
The key takeaway from this quarter’s report is EVD’s continued revenue generation, demonstrating operational activity, even as the company works through a period of strategic adjustments, including a significant change in its financial year-end. This shift means direct year-on-year comparisons for the profit and loss statement are not available for this quarter, so we’ll be focusing on sequential Quarter-on-Quarter (QoQ) performance and cumulative nine-month figures to understand the trajectory.
Core Financial Highlights: A Look at the Numbers
For the nine-month period ended 31 March 2025, EVD BERHAD recorded a total revenue of RM19.36 million. While this indicates active business operations, the Group reported a cumulative loss before tax of RM6.05 million for the same period.
Let’s dive into the immediate quarter’s performance (Q3 FY2025) and compare it with the preceding quarter (Q2 FY2025) to understand recent trends:
Current Quarter (Q3 FY2025)
Revenue: RM8,775,000
Loss Before Tax: RM(1,341,000)
Basic Loss Per Share: (0.30) sen
Preceding Quarter (Q2 FY2025)
Revenue: RM6,202,000
Loss Before Tax: RM(2,555,000)
Basic Loss Per Share: N/A (implied from cumulative data)
From the comparison, we can see a positive sequential movement: Revenue for Q3 FY2025 increased by RM2.58 million, or 42%, compared to the immediate preceding quarter. This growth was primarily driven by the Extra Low Voltage Integrated Solution project. Furthermore, the Group’s loss before tax significantly narrowed from RM2.56 million in Q2 FY2025 to RM1.34 million in Q3 FY2025, representing a 48% improvement in reducing losses Quarter-on-Quarter.
Breakdown by Business Unit (Cumulative 9 Months Ended 31 March 2025)
Understanding where the revenue comes from is crucial. Here’s how EVD’s various segments contributed:
| Business Segment | Revenue (RM’000) | Contribution to Total Revenue |
|---|---|---|
| Extra Low Voltage Integrated Solution | 13,243 | ~68% |
| Transportation | 4,453 | ~23% |
| Others (Service & Maintenance) | 909 | ~5% |
| Healthcare | 413 | ~2% |
| Other Engineering Services | 340 | ~2% |
The Extra Low Voltage Integrated Solution segment clearly stands out as the primary revenue driver, contributing the lion’s share of the Group’s top line. This indicates a strong focus and performance in smart building and security services.
Financial Health and Cash Flow (as at 31 March 2025)
Beyond the profit and loss statement, the balance sheet and cash flow statement offer a deeper look into EVD’s financial robustness:
- Total Assets: RM171.89 million (vs. RM171.11 million as at 30 June 2024)
- Total Equity: RM68.10 million (vs. RM72.66 million as at 30 June 2024)
- Total Liabilities: RM103.79 million (vs. RM98.45 million as at 30 June 2024)
- Net Assets Per Ordinary Share: RM0.15 (vs. RM0.17 as at 30 June 2024)
- Cash and Cash Equivalents at Period End: RM7.53 million (a significant improvement from RM(3.92) million at the beginning of the financial year)
While total equity has seen a decrease due to accumulated losses, the Group’s cash position has significantly improved. The substantial increase in cash and cash equivalents to RM7.53 million from a negative balance at the start of the financial year is a positive sign, indicating effective cash management or inflows from financing and investing activities. This was supported by net cash from investing activities of RM4.63 million (primarily from withdrawal of fixed deposits) and net cash from financing activities of RM6.38 million (including proceeds from ordinary share issuance and drawdown of term loans).
Prospects and Navigating the Road Ahead
EVD BERHAD’s future outlook is closely tied to national infrastructure and digital transformation initiatives. The Malaysian government’s Budget 2025 highlights plans to expand existing transit systems, including railways and urban transit, and enhance inter-state mobility through projects like the East Coast Rail Link (ECRL) and Pan Borneo Highway. These initiatives are highly relevant to EVD’s Transportation system solutions segment.
Furthermore, the Malaysian healthcare system is undergoing a significant digital transformation to enhance service delivery and operational efficiency. This trend aligns perfectly with EVD’s expertise in providing ICT system solutions for hospital industries, presenting a clear growth avenue for its Healthcare segment.
The Group acknowledges the “market headwinds” but remains committed to enhancing its Information and Communications Technology (ICT) system solutions offerings. By leveraging its ICT expertise, EVD aims to provide solutions that not only meet current market demands but also anticipate future developments in the rapidly evolving transportation and healthcare sectors. This proactive approach is crucial for long-term sustainability and seizing new opportunities.
Key Challenges and Risks
While the prospects are encouraging, the report also highlights ongoing challenges:
- Financial Year-End Change: The change from 30 June to 31 December means the next audited financial statements will cover an 18-month period, which can make direct period-to-period performance comparisons more complex in the interim.
- Ongoing Losses: Despite the sequential improvement, the Group is still reporting losses, indicating that profitability remains a key area of focus and improvement.
- Material Litigations: The company is currently involved in two significant civil suits:
- A claim of RM600,292.00 against EVD Engineering Sdn Bhd by a sub-contractor, with the court setting aside a default judgment and fixing trial dates in April 2026.
- A claim of USD6,351,324.13 against EV-Dynamic Sdn. Bhd. by Hitachi Rail GTS Hong Kong Limited, which the company is actively defending.
These litigations represent potential financial and reputational risks that warrant close monitoring.
Summary and
EVD BERHAD’s Q3 FY2025 report showcases a company actively engaged in its core business areas, particularly in Extra Low Voltage Integrated Solutions, which significantly boosted revenue this quarter. The sequential improvement in revenue and reduction in losses are encouraging signs of operational progress. The company is strategically positioned to capitalize on Malaysia’s ongoing infrastructure development and digital transformation in key sectors like transportation and healthcare.
However, investors should remain mindful of the persistent losses and the potential impact of ongoing material litigations. The change in financial year-end also means that a clear, comparable historical trend is temporarily obscured, requiring a deeper dive into sequential performance and the broader strategic narrative.
Key risk points highlighted in the report include:
- The Group’s continued operating losses, requiring sustained efforts towards profitability.
- The financial and operational implications of two significant ongoing civil suits.
- The complexities introduced by the change in financial year-end, affecting comparative analysis.
From a professional standpoint, EVD BERHAD appears to be in a transition phase, leveraging its core competencies in a market ripe with government-backed initiatives. The Quarter-on-Quarter improvement in revenue and reduced losses suggest that management’s strategies are beginning to yield positive operational results, though the path to sustained profitability and managing legal challenges will be critical.
What are your thoughts on EVD BERHAD’s latest performance? Do you believe the government’s infrastructure and digital healthcare push will be enough to turn the tide for the company? Share your insights in the comments below!
