C.I. Holdings Berhad: Navigating Growth Amidst Shifting Tides in Q3 FY2025
Greetings, fellow investors and market watchers! Today, we’re diving into the latest financial performance of C.I. Holdings Berhad, a key player primarily known for its edible oil products, as they unveil their consolidated results for the third financial quarter ended 31st March 2025.
This quarter’s report presents a fascinating mix of robust top-line growth and bottom-line pressures, alongside a significant strategic divestment. While revenue surged by over 50% compared to the same quarter last year, profitability faced headwinds, largely influenced by currency volatility. Let’s unpack the details and see what this means for the company’s trajectory.
Core Financial Highlights: A Closer Look at the Numbers
C.I. Holdings Berhad demonstrated impressive revenue expansion in the third quarter of its financial year 2025. This growth was largely driven by its continuing operations, predominantly the edible oil products segment.
Revenue Performance: Strong Growth, but Watch the Trend
The company reported a substantial increase in revenue for the current quarter when compared to the same period last year. This surge is primarily attributed to higher average palm olein prices and increased demand from the African region and the Indian Subcontinent.
Q3 FY2025 Revenue
RM1,137,270,000
Q3 FY2024 Revenue
RM754,335,000
This represents a remarkable 51% increase in revenue for the quarter. Looking at the cumulative nine-month performance, revenue also saw an 8% rise, reaching RM3,352,604,000 compared to RM3,108,438,000 in the previous year.
However, it’s worth noting a sequential decline in revenue. Compared to the preceding quarter (Q2 FY2025), revenue decreased by 7%, from RM1,224,444,000 to RM1,137,270,000. This was due to a slight decline in sales volume and lower demand from the Africa region, coupled with a decrease in average RBD Palm Olein prices.
Profitability: Facing Currency Headwinds
Despite the strong revenue growth, the company’s profitability in the current quarter experienced a downturn compared to the same period last year. This was mainly due to the volatility of the US Dollar against the Malaysian Ringgit, leading to increased realised and unrealised foreign exchange losses.
Q3 FY2025 Profit Before Tax
RM33,902,000
Q3 FY2024 Profit Before Tax
RM40,633,000
This translates to a 17% decrease in profit before tax for the quarter. Similarly, profit after tax from continuing operations also fell by 17%, from RM39,366,000 to RM32,679,000.
On a year-to-date basis, the picture is more stable, with profit before tax showing a modest 2% increase to RM97,821,000, and profit after tax from continuing operations rising by 3% to RM93,868,000.
Earnings Per Share (EPS): Reflecting Profit Trends
Earnings per share (EPS) from continuing operations for the quarter also reflect the decline in net profit. For Q3 FY2025, basic EPS from continuing operations stood at 11.68 sen, down from 16.63 sen in Q3 FY2024. Cumulatively, year-to-date EPS from continuing operations saw a slight improvement, reaching 34.37 sen compared to 33.77 sen in the prior year.
Segmental Performance: Edible Oil Dominates
For the third quarter ended 31st March 2025, C.I. Holdings Berhad’s operations are primarily driven by its Edible Oil Products segment. The company has also completed the disposal of its tapware and sanitary ware business (Doe Industries Sdn Bhd) in January 2025, which was previously classified under discontinued operations.
| Segment (Q3 FY2025) | Revenue (RM’000) | Operating Profit/(Loss) (RM’000) |
|---|---|---|
| Edible Oil Products | 1,137,270 | 40,653 |
| Investment Holdings/Others | – | (2,683) |
| Total Continuing Operations | 1,137,270 | 37,970 |
The edible oil segment remains the core revenue and profit generator for the Group.
Financial Health: Balance Sheet and Cash Flow Insights
As of 31st March 2025, C.I. Holdings Berhad’s total assets increased to RM1,245,204,000 from RM1,045,634,000 at the end of June 2024. Total equity also grew to RM601,797,000 from RM561,908,000, leading to a higher net assets per share of RM2.95 (from RM2.81).
However, a closer look at the cash flow statement reveals some shifts. The company experienced a net cash outflow from operating activities of RM104,168,000 for the nine-month period, a stark contrast to the RM221,698,000 generated in the same period last year. This was significantly impacted by a large increase in trade receivables, indicating that a substantial portion of sales are on credit, tying up operational cash.
Consequently, cash and bank balances decreased from RM348,678,000 as of 30th June 2024 to RM103,315,000 as of 31st March 2025. To manage this, the company saw a net drawdown of borrowings of RM125,568,000, bringing total bank borrowings to RM444,546,000.
Risks and Prospects: Navigating the Future
The current quarter’s results highlight both the opportunities and challenges facing C.I. Holdings Berhad. The strong demand for palm olein from key markets like Africa and the Indian Subcontinent presents a significant opportunity for the edible oil division to expand its market presence and capitalize on pricing trends.
However, the group is not without its challenges. The volatility of the US Dollar against the Malaysian Ringgit poses a continuous risk to profitability, as evidenced by the foreign exchange losses impacting operating profit. Additionally, the sequential decline in revenue due to lower sales volume and decreasing palm olein prices signals the dynamic and sometimes unpredictable nature of commodity markets.
In response to these dynamics, the company stated that it “will cautiously continue with its expansion plans for its edible oil division operations to maximise shareholders’ value.” This indicates a strategic focus on strengthening its core business. Furthermore, the disposal of the tapware and sanitary ware business suggests a strategic streamlining of operations, allowing the company to concentrate resources on its primary growth engine.
Summary and
C.I. Holdings Berhad’s Q3 FY2025 report paints a picture of a company actively navigating a complex market. While the edible oil segment continues to drive substantial revenue growth, the impact of foreign exchange volatility on the bottom line is a clear area of concern. The strategic divestment of the tapware business signifies a focused approach on core competencies, which could be beneficial in the long run.
The increase in trade receivables and the shift to negative operating cash flow, leading to higher borrowings, are financial metrics that warrant close observation. While these may be temporary working capital fluctuations related to business expansion or market conditions, sustained trends would require further analysis.
Key points from this report include:
- Robust revenue growth in the core edible oil segment, driven by price and demand.
- Profitability challenges due to adverse foreign exchange movements and sequential declines in palm olein prices and demand.
- Strategic divestment of non-core assets to streamline operations.
- Increased trade receivables and a shift to negative operating cash flow, necessitating higher borrowings.
The company’s commitment to cautiously expanding its edible oil operations suggests a forward-looking strategy to leverage its strengths. Investors will be keen to see how these expansion plans translate into improved profitability and cash generation in future quarters.
Summary and
C.I. Holdings Berhad’s Q3 FY2025 report paints a picture of a company actively navigating a complex market. While the edible oil segment continues to drive substantial revenue growth, the impact of foreign exchange volatility on the bottom line is a clear area of concern. The strategic divestment of the tapware business signifies a focused approach on core competencies, which could be beneficial in the long run.
The increase in trade receivables and the shift to negative operating cash flow, leading to higher borrowings, are financial metrics that warrant close observation. While these may be temporary working capital fluctuations related to business expansion or market conditions, sustained trends would require further analysis.
Key points from this report include:
- Robust revenue growth in the core edible oil segment, driven by price and demand.
- Profitability challenges due to adverse foreign exchange movements and sequential declines in palm olein prices and demand.
- Strategic divestment of non-core assets to streamline operations.
- Increased trade receivables and a shift to negative operating cash flow, necessitating higher borrowings.
The company’s commitment to cautiously expanding its edible oil operations suggests a forward-looking strategy to leverage its strengths. Investors will be keen to see how these expansion plans translate into improved profitability and cash generation in future quarters.
Final Thoughts: What’s Next for C.I. Holdings Berhad?
C.I. Holdings Berhad is clearly in a phase of strategic adaptation, focusing on its strong edible oil business while managing external economic pressures. The ability to maintain robust revenue growth is a positive sign, but converting that top-line performance into consistent bottom-line strength will be key.
Given the robust revenue growth in its core edible oil business and the strategic divestment, do you believe C.I. Holdings is well-positioned to navigate the current economic headwinds and convert top-line growth into stronger bottom-line performance in the coming quarters? Share your thoughts in the comments below!
