Northern Solar’s Q4 FY2025: A Post-IPO Snapshot of Growth and Strategic Positioning
Northern Solar Holdings Berhad, a dynamic player in Malaysia’s burgeoning renewable energy sector, recently unveiled its unaudited interim financial report for the fourth quarter ended 31 March 2025. This report marks a significant milestone as it’s the third interim financial report since the company’s successful listing on Bursa Malaysia’s ACE Market on 6 February 2025.
While the fourth quarter saw a moderation in profit, largely influenced by one-off listing expenses, the full-year performance for FY2025 paints a robust picture of growth. The company’s strategic positioning post-IPO and its strengthened financial standing are key takeaways, highlighting its ambition to capture a larger share of Malaysia’s expanding solar market.
Key Highlight: Despite Q4 being impacted by IPO costs, Northern Solar recorded a commendable cumulative profit after tax of RM11.41 million for the full financial year ended 31 March 2025, demonstrating a solid debut as a public entity.
A Look at the Numbers: Q4 FY2025 Performance
Comparing the latest quarter (Q4 FY2025) with the immediate preceding quarter (Q3 FY2025) provides valuable insights into Northern Solar’s operational dynamics. The Group’s revenue and profitability saw a dip, primarily due to project milestones and the significant impact of IPO-related expenses.
Q4 FY2025 (31 March 2025)
Revenue: RM20,660k
Gross Profit: RM7,955k
Profit Before Tax (PBT): RM2,397k
Profit After Tax (PAT): RM549k
Q3 FY2025 (31 December 2024)
Revenue: RM24,049k
Gross Profit: RM8,132k
Profit Before Tax (PBT): RM4,834k
Profit After Tax (PAT): RM3,433k
Revenue for the current quarter decreased by RM3.4 million, or 14.09%, from the immediate preceding quarter, mainly attributed to the timing of project milestones. More notably, the Profit Before Tax (PBT) saw a sharper decline of 50.41%, dropping by RM2.4 million. This significant reduction in profitability is largely due to IPO-related expenses amounting to RM2.76 million, which were recognized in the administrative expenses for the quarter.
Full-Year FY2025: A Robust Debut
As this is Northern Solar’s third interim financial report since its IPO, comparative figures for the preceding corresponding quarter and year-to-date are not available. However, the cumulative performance for the full financial year ended 31 March 2025 showcases a strong start as a listed entity:
- Cumulative Revenue: RM84,865k
- Cumulative Profit Before Tax (PBT): RM17,064k
- Cumulative Profit After Tax (PAT): RM11,405k
- Basic Earnings Per Share (EPS): 2.88 sen (based on enlarged share capital post-IPO)
This full-year performance underscores the company’s underlying operational strength and its ability to generate substantial revenue and profit from its core businesses.
Delving Deeper: Segmental Contributions
Northern Solar’s revenue streams are primarily driven by three key segments. For the fourth quarter ended 31 March 2025, the breakdown is as follows:
- EPCC of solar PV systems: RM20,045k (97.02% of total revenue)
- Generation of renewable energy: RM583k
- Operations & Maintenance (O&M) of solar PV equipment and systems: RM32k
The dominance of the Engineering, Procurement, Construction, and Commissioning (EPCC) segment highlights its crucial role in the Group’s overall revenue generation, reflecting the company’s active involvement in developing new solar projects across Malaysia.
Strengthening the Foundation: Financial Position
The IPO has significantly bolstered Northern Solar’s financial health, as evidenced by its Statement of Financial Position:
| Financial Indicator | As at 31 March 2025 (Unaudited, RM’000) | As at 31 March 2024 (Audited, RM’000) |
|---|---|---|
| Total Assets | 97,056 | 38,114 |
| Total Equity | 68,090 | 20,654 |
| Cash and Bank Balances | 52,217 | 9,003 |
| Net Assets per Ordinary Share (RM) | 0.17 | 0.06 |
The substantial increase in total assets, total equity, and cash and bank balances is a direct result of the IPO proceeds, which amounted to approximately RM42.4 million. This influx of capital has significantly strengthened the company’s balance sheet, providing a solid foundation for future expansion. While total borrowings increased from RM2,659k to RM10,305k, it’s worth noting that a portion of the IPO proceeds (RM3,403k) has already been utilized for repayment of bank borrowings, enhancing financial flexibility.
Charting the Future: Prospects and Strategic Advantages
Northern Solar’s listing on Bursa Malaysia’s ACE Market in February 2025 has strategically positioned the Group to actively participate in the expanding Large-Scale Solar (LSS) market. The strengthened financial position post-IPO is a significant advantage, improving access to financing facilities and enabling the Group to competitively bid for larger and more technically complex renewable energy projects within the LSS segment.
The company is actively pursuing emerging opportunities in upcoming renewable energy schemes, including the Corporate Renewable Energy Support Scheme (CRESS), Corporate Renewable Energy Agreement Model (CREAM), and future tenders under LSS5, LSS5+, and LSS6. Northern Solar expresses optimism about securing new contracts from these initiatives, which are expected to enhance its project pipeline and drive sustainable long-term growth.
Navigating the Challenges
While the outlook is positive, the report also implicitly highlights areas that warrant attention. The substantial impact of one-off IPO-related expenses on Q4 profitability underscores the costs associated with becoming a public entity. Additionally, the Group’s effective tax rate for both the quarter and year-to-date was higher than the statutory rate, mainly due to the add-back of non-allowable expenses. The nature of project-based revenue (EPCC) means that revenue recognition can fluctuate based on project milestones, as seen in the Q-o-Q decline. Northern Solar also utilizes derivative financial instruments to hedge against foreign currency fluctuations, indicating exposure to such risks.
Summary and
Northern Solar Holdings Berhad’s latest financial report for the fourth quarter ended 31 March 2025 provides a comprehensive look at its performance post-IPO. Despite a notable dip in Q4 profitability due to one-off listing expenses and project milestones, the cumulative full-year results for FY2025 demonstrate a strong foundation with healthy revenue and profit figures. The IPO has significantly strengthened the company’s balance sheet, providing ample cash and equity to fuel its growth ambitions.
The company is strategically poised to leverage its enhanced financial position to tap into the robust demand within Malaysia’s renewable energy sector, actively pursuing opportunities in various large-scale solar initiatives. This forward-looking strategy, combined with a strong financial base, paints a promising picture for Northern Solar’s future trajectory.
Key points to consider for Northern Solar’s future development include:
- The company’s ability to secure new contracts from upcoming renewable energy schemes like CRESS, CREAM, and future LSS tenders.
- The successful integration and execution of larger, more complex projects enabled by its strengthened balance sheet.
- Management of operational costs and effective tax planning to optimize future profitability.
- The impact of project milestone-based revenue recognition on quarterly performance.
No direct are made in this blog post. Readers are encouraged to conduct their own thorough research and consult with financial professionals before making any investment decisions.
From a blogger’s perspective, this report paints a picture of a company transitioning from pre-IPO growth to a publicly listed entity with expanded capabilities. While the Q4 profit dip due to listing costs is noteworthy, the underlying full-year performance and strategic outlook for tapping into Malaysia’s growing solar market suggest a company with significant potential.
With a strengthened financial position and clear strategic direction, do you believe Northern Solar Holdings Berhad is poised for sustained growth in Malaysia’s dynamic renewable energy landscape? Share your thoughts in the comments below!
