Winstar Capital Berhad’s Q1 2025 Report: A Strong Start Post-Listing Amidst Strategic Expansion
Greetings, fellow investors and market watchers! Today, we’re diving into the latest interim financial report from Winstar Capital Berhad for the first quarter ended 31 March 2025. As a company that only debuted on Bursa Malaysia’s ACE Market on 19 December 2024, this report marks a significant milestone, offering our first glimpse into its post-listing performance. And what a start it is!
The report showcases a robust performance, especially when compared to the immediate preceding quarter, indicating healthy growth driven by improved market demand and strategic business initiatives. Let’s unpack the numbers and see what Winstar Capital has been up to.
Core Data Highlights: Unpacking the Performance
First Quarter 2025 Performance Overview
For its inaugural quarter as a listed entity, Winstar Capital Berhad reported a solid financial showing. The Group achieved a revenue of RM57.59 million. This translated into a gross profit of RM10.04 million, yielding a healthy gross profit margin of 17.44%. Profit before tax (PBT) stood at RM3.38 million, with a PBT margin of 5.87%, and ultimately, a profit after tax (PAT) of RM2.49 million, representing a PAT margin of 4.32%.
A key highlight for shareholders is the basic and diluted earnings per share (EPS) of 0.86 sen for the quarter. It’s important to note that due to Winstar Capital’s recent listing, there are no comparative figures for the corresponding quarter of the previous year (Q1 2024).
Quarter-on-Quarter Growth: Q1 2025 vs. Q4 2024
While year-on-year comparisons aren’t available, comparing the current quarter’s performance against the immediate preceding quarter (Q4 2024) provides valuable insights into the Group’s operational momentum and financial health. Winstar Capital demonstrated impressive growth, particularly in its profitability.
Current Quarter (Q1 2025)
| Revenue | RM57,594k |
| Gross Profit | RM10,043k |
| Profit Before Tax | RM3,382k |
| Profit After Tax | RM2,490k |
Preceding Quarter (Q4 2024)
| Revenue | RM55,531k |
| Gross Profit | RM10,420k |
| Profit Before Tax | RM79k |
| Profit After Tax | RM415k |
Revenue for Q1 2025 saw a modest increase of RM2.06 million, or 3.72%, rising to RM57.59 million from RM55.53 million in the immediate preceding quarter. This growth was primarily fueled by higher sales volume and improved market demand.
The most striking improvement is in profitability. Profit before tax surged by an astounding RM3.30 million, or 4,181.01%, from RM0.08 million in Q4 2024 to RM3.38 million in Q1 2025. Similarly, profit after tax skyrocketed by RM2.08 million, or 500.00%, from RM0.42 million to RM2.49 million. This significant jump in profitability is largely attributable to the absence of one-off listing expenses amounting to RM2.95 million and provisions for employee bonuses that were recorded in the immediate preceding quarter (Q4 2024).
Revenue by Business Segments
Winstar Capital’s revenue is primarily driven by its core businesses. In Q1 2025:
- Aluminium extrusion contributed RM29.60 million.
- Trading and distribution of building materials added RM25.68 million.
Combined, these core segments accounted for RM55.28 million, representing a substantial 81.78% of the total revenue. The non-core business of Solar PV system installation services also contributed RM2.32 million, showcasing the Group’s diversification efforts.
Financial Health and Capital Commitments
Looking at the balance sheet as of 31 March 2025, Winstar Capital’s total assets stood at RM255.05 million, a slight decrease from RM259.12 million at the end of 2024. However, total equity increased to RM101.06 million from RM98.57 million, pushing the net assets per ordinary share up to 34.85 sen from 33.99 sen. This indicates a strengthening equity base, despite a slight dip in total assets.
Total liabilities saw a reduction to RM153.99 million from RM160.55 million, though total borrowings increased to RM114.74 million from RM104.33 million. It’s worth noting that the Group’s cash and cash equivalents ended the quarter at a negative RM6.42 million. This figure includes a significant bank overdraft of RM18.41 million and fixed deposits pledged to licensed banks amounting to RM7.48 million, which offsets the positive cash and bank balances of RM6.999 million and unpledged fixed deposits of RM12.477 million.
Crucially, Winstar Capital has significant capital commitments totaling RM20.06 million, primarily for the construction of its new manufacturing facility (Lot 903 Facility) and the purchase of new aluminium press machines and equipment. These investments are strategic, aimed at expanding capacity and will be funded by a mix of bank borrowings and IPO proceeds, signaling confidence in future growth.
Prospects and Strategic Outlook
The outlook for Winstar Capital appears promising, underpinned by favorable industry trends and the Group’s proactive expansion strategies. The Malaysian aluminium extrusion market is projected to grow by 6.0% to 8.0% annually from 2024 to 2028, driven by increasing demand from construction, transportation, and renewable energy sectors. The Malaysian government’s focus on green building materials and energy-efficient technologies, coupled with aluminium’s lightweight and recyclable properties, further bolsters this growth.
The Malaysian construction sector is also expected to grow at a compound annual growth rate (CAGR) of 5.32% from 2024 to 2028, which will directly benefit Winstar’s aluminium extrusion and building materials distribution segments.
To capitalize on these opportunities, Winstar Capital is actively expanding its manufacturing capabilities. The construction of the Lot 903 Facility is on track for completion by Q2 2025, with two additional aluminium extrusion lines planned for installation in Q3 2025. This expansion is set to significantly boost production capacity, allowing the Group to meet anticipated demand and drive revenue growth.
Furthermore, Winstar is strategically positioning itself in the solar energy sector by focusing on the fabrication of aluminium solar PV mounting structures. This move aligns perfectly with the Malaysian government’s National Energy Transition Roadmap and initiatives like the Fifth Large-Scale Solar (LSS5) program, which are expected to generate substantial demand for solar-related products.
Summary and Outlook
Summary and
Winstar Capital Berhad’s first quarter 2025 report demonstrates a solid operational start post-listing, with impressive profit recovery driven by the absence of one-off expenses from the previous quarter. The Group’s core businesses remain strong, and its strategic expansion plans, particularly in enhancing production capacity and venturing further into solar PV solutions, position it well to capitalize on positive industry trends in Malaysia’s construction and renewable energy sectors.
While the overall outlook is positive, it’s always prudent to consider the inherent dynamics of any business. The increase in borrowings and negative cash and cash equivalents from operating activities, primarily due to bank overdrafts and pledged deposits, warrant continued monitoring. However, these are largely tied to strategic capital expenditure for future growth.
- Positive Industry Tailwinds: The projected growth in Malaysia’s aluminium extrusion and construction sectors provides a strong foundation for Winstar’s core businesses.
- Strategic Capacity Expansion: The ongoing construction of the Lot 903 Facility and planned installation of new extrusion lines are crucial for meeting future demand and driving revenue.
- Diversification into Green Energy: The focus on solar PV mounting structures aligns with national energy transition goals, offering a new growth avenue.
- Profitability Recovery: The significant rebound in profit after tax from the preceding quarter is a positive sign of underlying operational efficiency once one-off listing costs are behind them.
Final Thoughts and Your Perspective
Winstar Capital Berhad has certainly kicked off its journey as a publicly listed company with a clear vision for growth, backed by strategic investments and a favorable market outlook. The first quarter results offer a compelling narrative of a company poised for expansion in key sectors of the Malaysian economy.
What are your thoughts on Winstar Capital’s strategic direction? Do you believe the ongoing facility expansion and focus on renewable energy will be sufficient to drive sustainable long-term growth? Share your insights and let’s discuss in the comments below!
