Malaysian investors, grab your kopi and settle in! Today, we’re diving deep into the latest financial report from WTK Holdings Berhad for the first quarter ended 31 March 2025 (1Q2025). This quarter has certainly been a mixed bag, revealing significant challenges but also highlighting strategic shifts that could reshape the company’s future.
While the headline figures show a loss for the period, it’s crucial to look beyond the surface. WTK Holdings is navigating a period of transition, marked by a significant one-off event in one of its segments, alongside robust growth in its core businesses and a healthy improvement in operating cash flow. Let’s break down the numbers and understand what’s truly happening.
Unpacking the Numbers: A Closer Look at 1Q2025 Performance
WTK Holdings reported a revenue of RM156.6 million for the first quarter of 2025. This represents a slight decrease of 2% compared to the RM159.0 million recorded in the corresponding quarter of the previous year. The most significant impact on the financial results came from an operating loss, leading to a pre-tax loss.
Overall Financial Performance
1Q2025
Revenue: RM156.6 million
Loss before tax: RM17.5 million
Loss for the period: RM21.5 million
Basic Loss per share: (4.58) sen
1Q2024
Revenue: RM159.0 million
Profit before tax: RM5.3 million
Profit for the period: RM4.9 million
Basic Earnings per share: 1.14 sen
The shift from a profit to a loss before tax of RM17.5 million in the current quarter, compared to a profit of RM5.3 million in the preceding year corresponding quarter, was primarily due to impairment losses and asset write-offs within the tapes segment, stemming from a fire incident in January 2025. This one-off event significantly impacted the overall profitability.
Segmental Performance Breakdown
Delving into the individual business segments reveals a more nuanced picture:
Plantation Segment: Growing Strong
1Q2025
Revenue: RM80.1 million
Profit before tax: RM11.8 million
1Q2024
Revenue: RM64.4 million
Profit before tax: RM10.9 million
The Plantation segment demonstrated strong growth, with revenue increasing by 24% and profit before tax rising by 7% compared to the preceding year corresponding quarter. This impressive performance was mainly driven by higher production of fresh fruit bunches (FFB) and improved FFB selling prices. It’s worth noting that the profit before tax in the corresponding quarter last year included a one-off gain from a bargain purchase related to the acquisition of Durafarm Sdn. Bhd.
Food Segment: Expanding Reach
1Q2025
Revenue: RM34.8 million
Profit before tax: RM2.4 million
1Q2024
Revenue: RM25.9 million
Profit before tax: RM1.7 million
The Food segment also showed robust growth, with revenue surging by 34% and profit before tax jumping by 45% compared to the preceding year corresponding quarter. This positive trend is attributed to the Group’s continuous efforts to increase product offerings and expand market penetration.
Tapes Segment: Facing Headwinds
1Q2025
Revenue: RM12.1 million
Loss before tax: RM22.5 million
1Q2024
Revenue: RM18.4 million
Profit before tax: RM2.1 million
This segment experienced a significant downturn, with revenue decreasing by 34% and registering a substantial loss before tax. The main culprit was a fire incident at the tapes manufacturing plant, leading to operation disruption and a hefty RM22.0 million in written-off and impaired assets and inventory.
Timber Segment: Undergoing Restructuring
1Q2025
Revenue: RM29.6 million
Loss before tax: RM5.6 million
1Q2024
Revenue: RM50.6 million
Loss before tax: RM3.2 million
The Timber segment’s revenue declined sharply by 42%, and its loss before tax widened. This was primarily due to the cessation of plywood manufacturing activity and the scaling down of logging operations, in anticipation of the proposed disposal of two logging subsidiaries
