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Infomina’s Q4 Shocker: A Deep Dive into a Surprising Loss and Future Ambitions
Infomina Berhad, a key player in the technology infrastructure space, just released its financial results for the fourth quarter ending May 31, 2025. While the year brought some strategic wins, the final quarter delivered a surprising twist: a net loss, primarily driven by a significant one-off provision. This report has certainly given investors a lot to digest.
So, what’s really going on behind the numbers? Is this a temporary blip or a sign of deeper issues? Let’s break down the report to understand the challenges, the hidden strengths, and the future direction of the company.
The headline story for this quarter is a Loss Before Tax of RM1.5 million, a stark contrast to the RM10.4 million profit in the same quarter last year. This was heavily impacted by a RM10.0 million provision for doubtful debts from a single customer in the Philippines.
Core Data Highlights: A Mixed Bag Performance
Quarterly Performance: A Hit from Provisions
Comparing this quarter to the same period last year, we see a clear impact from the provision for doubtful debts. While revenue saw a modest decline, profitability took a significant hit, swinging the company into a loss-making position for Q4.
Q4 FY2025 (Current Quarter)
Revenue: RM 53.4 million
Loss Before Tax (LBT): RM 1.5 million
Loss After Tax (LAT): RM 3.2 million
Earnings Per Share (EPS): -0.52 sen
Q4 FY2024 (Corresponding Quarter)
Revenue: RM 58.5 million
Profit Before Tax (PBT): RM 10.4 million
Profit After Tax (PAT): RM 8.0 million
Earnings Per Share (EPS): 1.34 sen
The 8.7% dip in revenue was mainly due to lower delivery of hardware in the ‘design and delivery’ segment compared to a stronger performance last year. However, the 114.4% plunge in pre-tax results from profit to loss is almost entirely attributable to the RM10.0 million provision, a necessary measure to account for potential non-payment from a customer in the Philippines.
Full-Year Perspective: Resilience Amidst Challenges
Looking at the full financial year, the story is one of resilience. Despite the Q4 setback and a general slowdown in the project-based segment, Infomina remained profitable for the year, although earnings were lower compared to the previous year.
| Full Year Ended May 31 | FY2025 | FY2024 | Change |
|---|---|---|---|
| Revenue | RM 196.7 million | RM 225.2 million | -12.6% |
| Profit Before Tax (PBT) | RM 27.4 million | RM 42.0 million | -34.8% |
| Profit After Tax (PAT) | RM 21.1 million | RM 33.1 million | -36.2% |
| Earnings Per Share (EPS) | 3.51 sen | 5.50 sen | -36.2% |
Segment Breakdown: The Stable Core and The Volatile Arm
Infomina’s business is split into two main areas. This quarter highlighted the stability of its recurring income stream against the more volatile, project-based work.
- Technology Infrastructure Operations, Maintenance, and Support: This segment, which represents recurring revenue, performed well. Revenue grew to RM45.8 million this quarter from RM39.0 million last year, showing strong underlying demand for its core services.
- Design and Delivery of Technology Infrastructure Solutions: This project-based segment saw revenue fall significantly to RM7.7 million from RM19.5 million. This volatility is common in project-driven businesses and was a key factor in the overall revenue decline.
The Silver Lining: Strong Cash Flow and a Healthy Balance Sheet
Despite the profit challenges, Infomina’s financial health shows remarkable strength in one key area: cash flow. The company generated a robust net cash from operating activities of RM36.4 million for the full year, a massive improvement from a net cash usage of RM8.5 million in the previous year. This demonstrates an excellent ability to convert operational activities into hard cash.
Furthermore, the company’s cash and short-term deposits grew to RM94.7 million, and net assets per share increased to 25.19 sen from 23.77 sen a year ago, painting a picture of a fundamentally solid balance sheet.
Risk and Prospect Analysis: Charting the Course Ahead
Opportunities on the Horizon
Infomina is not standing still. The management has laid out a clear strategy for growth, focusing on new markets and technologies:
- Japan Expansion: The company’s push into Japan is already bearing fruit, contributing RM3.8 million in revenue this quarter alone. Management expects this to be a key growth driver in the next financial year.
- Harnessing AI: Infomina is making a strategic push into Artificial Intelligence. The establishment of a new subsidiary, Infomina Geolytik Sdn. Bhd., aims to digitize property valuation with its ‘ValuationXchange’ platform. This, along with its SSM Search platform, signals a clear ambition to capture a slice of the lucrative AI market.
Navigating the Risks
The Board remains optimistic, but it’s important to acknowledge the risks. The RM10.0 million provision serves as a stark reminder of the credit risks involved in overseas expansion. Managing customer creditworthiness will be crucial going forward. Additionally, the company operates against a backdrop of global economic uncertainties, which can affect client spending on large-scale tech projects.
Summary and Investment Recommendations
In summary, Infomina’s Q4 2025 results present a dual narrative. On one hand, a significant one-off provision led to a quarterly loss, raising concerns about credit risk. On the other hand, the company’s core maintenance business remains robust, its operational cash flow is exceptionally strong, and it is making exciting strategic moves into high-growth areas like Japan and AI. The challenge was significant, but the foundation appears solid.
For investors tracking Infomina, here are some key points to consider moving forward:
- Credit Risk Management: The RM10.0 million provision highlights the importance of monitoring the company’s credit control policies and receivables, especially as it expands internationally.
- Growth Engine Performance: Keep a close watch on the progress of the new ventures. The success of the Japan operations and the AI-driven platforms will be critical to offsetting the volatility of the project-based segment and driving future earnings.
- Cash is King: The company’s strong operating cash flow is a major positive. This financial flexibility allows it to invest in growth and weather economic downturns without excessive reliance on debt.
- One-Off vs. Trend: The key question is whether the Q4 loss was a one-off event or the start of a trend. The underlying strength in the maintenance segment and the positive cash flow suggest it may be the former, but future quarters will need to confirm this.
Final Thoughts and Your Turn
From my perspective, while the Q4 headline numbers are concerning, the report reveals a company in a dynamic phase of transition. The large provision is a painful but necessary adjustment. More importantly, the strong operational cash flow and strategic pivots into new markets like Japan and AI-powered platforms provide a compelling narrative for future growth. The key will be disciplined execution and prudent management of the risks that come with new ventures.
What are your thoughts on Infomina’s strategic shift towards AI and its expansion in Japan? Can these new ventures fuel the next wave of growth?
Share your insights in the comments below!
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