Navigating the Shifting Tides: A Look into Excel Force MSC’s Latest Financials (Q3 FY2025)

Greetings, fellow investors and market enthusiasts! Today, we’re diving deep into the unaudited financial statements of Excel Force MSC Berhad for the financial period ended 31 March 2025. As a prominent player in Malaysia’s financial technology landscape, their performance often offers a valuable barometer for broader market trends.

This report presents a mixed bag, showcasing the company’s resilience in a challenging environment while highlighting areas where market dynamics have impacted performance. Notably, a final single-tier dividend of 0.50 sen per ordinary share, amounting to approximately RM3 million, was paid on 7 January 2025 for the financial period ended 30 June 2024, reflecting the company’s commitment to shareholder returns.

Core Financial Highlights: A Closer Look

Let’s break down the numbers that tell the story of Excel Force MSC’s recent performance. We’ll examine both the latest quarter’s results against the same period last year, as well as the cumulative nine-month performance, and a sequential quarter comparison to understand the immediate trends.

Quarterly Performance: March 2025 vs. March 2024

The third quarter ending 31 March 2025 saw a dip in several key metrics when compared to the corresponding quarter last year. This indicates a challenging operating environment for the period.

Revenue decreased by 10.7%, translating to a RM751k reduction. This had a cascading effect on profitability, with PBT falling by 26.0% (RM750k lower) and PAT by 30.9% (RM690k lower). Consequently, Basic EPS saw a notable decline from 0.39 sen to 0.25 sen.

Year-to-Date Performance: 9 Months Ended March 2025 vs. March 2024

Looking at the cumulative performance for the nine months, the trends largely mirror the quarterly results, indicating a sustained impact over the longer period.

For the nine months ended 31 March 2025, revenue was RM20.5 million, a decrease of RM1.1 million or 5.2% compared to the same period last year. PBT and PAT were RM6.9 million and RM5.1 million respectively, showing declines of 15.0% and 17.1%. Basic EPS for the nine months also reduced from 1.03 sen to 0.84 sen.

Sequential Quarter Comparison: Q3 FY2025 vs. Q2 FY2025

Comparing the current quarter with the immediate preceding quarter (Q2 FY2025) provides insight into recent momentum.

Revenue for the current quarter was RM6.3 million, an 8% reduction from the RM6.8 million recorded in the immediate preceding quarter. PBT and PAT also saw slight decreases of 1% and 7% respectively, primarily due to the lower revenue, though partially offset by lower cost of sales.

Segmental Performance: Where Did the Impact Come From?

The report attributes the lower revenue primarily to the Application Solutions (AS) segment, which focuses on sales of software applications. While the Application Services Providers (ASP) and Maintenance Services segments showed slight variations, the AS segment’s performance was the main driver behind the overall revenue decline.

Excel Force MSC operates in distinct segments: Application Solutions (AS) for outright software purchases, Application Services Providers (ASP) for volume and transaction-based outsourcing, and Maintenance Services. The decrease in the AS segment’s revenue was the key factor affecting the group’s overall top-line performance.

Financial Health Check: Balance Sheet & Cash Flow

As of 31 March 2025, Excel Force MSC maintains a robust financial position. Total assets stood at RM146.7 million, a slight decrease from RM148.1 million at 30 June 2024. Total equity, however, saw a modest increase to RM130.2 million from RM128.1 million over the same period, indicating a strengthening shareholder base.

Cash and cash equivalents increased to RM22.0 million from RM21.0 million at 30 June 2024, providing a healthy liquidity buffer. However, net cash generated from operating activities for the nine months ended 31 March 2025 was RM8.4 million, a significant decrease compared to RM24.7 million in the prior corresponding period. This suggests a need to monitor operational efficiency and working capital management closely going forward.

Prospects and Navigating the Headwinds

The management of Excel Force MSC acknowledges the current global economic uncertainties. The ongoing global trade wars, with their tariffs and retaliatory responses, are eroding business confidence and making forecasts difficult. The impact on inflation and interest rates also remains largely uncertain and unpredictable.

Despite Malaysia’s economy expanding by 5% in Q4 2024 and 5.1% for the full year, the global trade situation continues to dampen overall business outlook, which has a spillover effect on Bursa Malaysia’s market sentiment and trading volume. This macro environment naturally affects companies operating in the financial services sector, including Excel Force MSC.

However, the report highlights a crucial silver lining: customers continue to allocate funds for technology investment. This is driven by a need to accelerate time-to-market for new products and services, essential for staying competitive. Excel Force MSC is actively responding to this by:

• Enhancing existing system capabilities.
• Developing new products and services to refresh and expand their offerings.
• Leveraging Artificial Intelligence (AI) technology, specifically focusing on the financial services sector.

Concurrently, the Group is focused on internal improvements, aiming to enhance productivity and efficiency in resource utilization, monitor spending, and review processes to reduce waste. These measures are all geared towards ensuring margin growth. Given these strategic initiatives and the market landscape, the Group remains “cautiously optimistic” about its future business performance.

What Are Your Thoughts?

Excel Force MSC is clearly making strategic moves to adapt to the evolving market and technological landscape. Do you think their focus on AI and enhancing existing systems will be enough to overcome the current economic uncertainties and drive future growth? Share your views in the comments below!

Stay tuned for more in-depth analyses of Malaysian companies right here on our blog!