Navigating the currents of a dynamic market, ALCOM GROUP BERHAD (AGB) has just released its first-quarter results for the period ended 31 March 2025. This report offers a glimpse into the company’s performance, revealing a significant surge in revenue but also highlighting the challenges impacting its bottom line. While AGB showcased robust top-line growth, a deeper dive into the financials reveals a strategic pivot and the hurdles faced in a complex global economic landscape.
Let’s unpack the key figures and strategic moves from this latest report.
Core Data Highlights: A Closer Look at AGB’s Performance
Overall Financial Performance
AGB’s first quarter of 2025 saw a notable increase in revenue, demonstrating strong sales momentum. However, this growth did not translate to the same level of profitability, with profit before tax experiencing a significant dip.
| Financial Metric | Q1 FY2025 (RM’000) | Q1 FY2024 (RM’000) | Change (%) |
|---|---|---|---|
| Revenue | 173,087 | 138,742 | 25% |
| Profit Before Tax | 17 | 428 | -96% |
| Net (Loss)/Profit | (183) | 318 | -157% |
| Basic (Loss)/Earnings Per Share (sen) | (0.24) | 0.20 | -220% |
The company reported a revenue of RM173.09 million for Q1 FY2025, a substantial 25% increase compared to RM138.74 million in the same quarter last year. This growth was primarily driven by the manufacturing segment. Despite the revenue boost, profit before tax decreased by 96% to just RM0.02 million from RM0.43 million in Q1 FY2024. Consequently, the company recorded a net loss of RM0.18 million, a stark contrast to the RM0.32 million profit in the corresponding period last year, leading to a basic loss per share of 0.24 sen.
Segmental Performance Breakdown
Understanding AGB’s performance requires a look at its diverse business units:
Manufacturing Segment
Q1 FY2025 Revenue: RM169.81 million
Q1 FY2025 PBT: RM1.16 million
Q1 FY2024 Revenue: RM133.45 million
Q1 FY2024 PBT: RM0.45 million
The manufacturing segment, contributing approximately 98% of total revenue, saw a robust 27% increase in revenue. This was attributed to a 17% surge in shipment volume, particularly strong exports of coated fins to India, and a 20% higher base metal price (denominated in USD). However, the weakening of the USD against the Ringgit Malaysia by approximately 5% partially offset these gains. Despite the currency headwinds, the manufacturing segment’s profit before tax jumped by 157%, driven by a higher-margin product mix and lower energy costs.
Property Development Segment
Q1 FY2025 Revenue: RM0 million
Q1 FY2025 PBT: (RM0.64 million)
Q1 FY2024 Revenue: RM0.97 million
Q1 FY2024 PBT: RM0.13 million
The property development segment recorded no revenue in Q1 FY2025, a significant change from RM0.97 million in Q1 FY2024. This was primarily due to the EmHub project being almost fully sold in FY2024. Consequently, the segment reported a loss before tax of RM0.64 million, compared to a profit of RM0.13 million in the prior year, though this loss was partially mitigated by higher administrative fee income and reduced marketing expenses.
Construction Segment
Q1 FY2025 External Revenue: RM3.56 million
Q1 FY2025 PBT: RM1.70 million
Q1 FY2024 External Revenue: RM4.59 million
Q1 FY2024 PBT: RM0.09 million
The construction segment’s external revenue decreased to RM3.56 million from RM4.59 million in Q1 FY2024, mainly from its roofing and cladding projects. However, this segment saw a remarkable increase in profit before tax to RM1.70 million from RM0.09 million, largely driven by the ongoing construction of the Group’s internal manufacturing facility expansion project and its roofing and cladding works.
Financial Position and Cash Flow
As of 31 March 2025, AGB’s total assets stood at RM665.74 million, up from RM654.56 million at the end of FY2024. This increase was mainly due to higher property, plant and equipment, inventories, and trade receivables. Cash and bank balances, however, saw a decrease to RM75.71 million from RM102.28 million.
From a cash flow perspective, AGB generated RM7.70 million in net cash from operating activities in Q1 FY2025, a significant improvement from RM3.71 million in the same period last year. Investing activities used RM11.34 million, primarily due to substantial purchases of property, plant, and equipment for expansion. Financing activities saw a net cash outflow of RM22.87 million, mainly due to net repayments of loans and borrowings.
Risk and Prospect Analysis: Navigating the Headwinds
AGB’s report also sheds light on the broader economic environment and the company’s strategic responses. The International Monetary Fund (IMF) has revised global growth projections for 2025 downwards, citing escalating trade tensions and renewed US protectionist policies, including a 25% tariff on steel and aluminium imports. For Malaysia, the IMF forecasts a lower GDP growth of 4.1% in 2025, impacted by weaker external demand and reciprocal US tariffs on Malaysian exports.
As an export-oriented manufacturing group, AGB faces challenges from the recent depreciation of the USD against the MYR, which impacts revenue in Ringgit terms and puts pressure on margins. In response, the Group is prudently advancing strategic initiatives:
- Geographical Diversification: Expanding into new, less tariff-exposed regions to mitigate geopolitical and concentration risks.
- Product Innovation: Driving product innovation to meet shifting market demands and consumer preferences.
- Operational Efficiency: Committed to enhancing operational efficiencies and implementing cost-control measures to sustain competitiveness.
On the property front, Malaysia’s market is expected to experience steady, moderate growth. AGB remains cautiously optimistic, especially following the completion of the acquisition of approximately 7.08 acres of commercial land in Bukit Raja, Klang. This strategically located land, near the planned Bandar Baru Klang LRT Station, is slated for a mixed development project in two phases. The application for planning permission for Phase 1 was submitted in September 2024 and is currently awaiting approval, signaling AGB’s continued focus on delivering competitive and differentiated property products.
Summary and
ALCOM GROUP BERHAD’s Q1 FY2025 report paints a picture of a company with strong revenue generation capabilities, particularly in its core manufacturing segment, which is adapting to a challenging global trade environment. While the significant drop in profit before tax and the net loss are concerns, they are largely attributed to external factors like currency fluctuations and the completion of major property projects. The Group’s proactive strategies to diversify markets, innovate products, and enhance operational efficiency demonstrate a clear path forward. The new land acquisition in Klang also signals long-term growth ambitions in the property sector. This blog post serves as an analysis of the company’s financial performance and strategic direction, and it does not constitute any form of investment advice or recommendation to buy or sell securities.
Key risk points to consider:
- The volatile global trade environment and potential for increased tariffs.
- Continued depreciation of the USD against the MYR, impacting export revenues and margins.
- Seasonal fluctuations in demand for finstock products, a key manufacturing output.
- The dependency on new project approvals and market demand for the success of its property development ventures.
What are your thoughts on ALCOM GROUP BERHAD’s latest performance? Do you think the company can navigate these headwinds effectively and sustain its growth trajectory? Share your insights in the comments below!
For more detailed financial analyses and market insights, check out our other articles on [Related Article 1] and [Related Article 2].
