TOMYPAK Holdings Berhad Navigates Q3 FY2025: A Turnaround Story Fueled by Strategic Disposals and Integration
Greetings, fellow investors and market watchers! Today, we’re diving deep into TOMYPAK Holdings Berhad’s latest unaudited condensed consolidated financial statements for the third quarter ended 31 March 2025. This report offers a compelling narrative of strategic maneuvers and operational shifts, revealing a significant turnaround in profitability despite a slight dip in quarterly revenue. For Malaysian retail investors, understanding these dynamics is key to appreciating TOMYPAK’s path forward in the competitive flexible packaging industry.
The headline? TOMYPAK has successfully swung from a loss to a pre-tax profit in the current quarter, largely driven by a one-off disposal gain. This, coupled with the ongoing integration of EB Packaging Sdn Bhd (EBP), paints a picture of a company actively reshaping its financial health and future prospects. Let’s unpack the details.
Core Data Highlights: A Snapshot of Performance
The third quarter of the financial year 2025 (Q3 FY2025) marks a pivotal period for TOMYPAK, showcasing a remarkable shift in its profitability. Here’s a closer look at the numbers:
Quarterly Performance (Q3 FY2025 vs Q3 FY2024)
Current Quarter (31 March 2025)
Revenue: RM53.0 million
Profit Before Tax: RM6.2 million
Profit After Tax: RM5.7 million
Earnings Per Share: 1.28 sen
Corresponding Quarter (31 March 2024)
Revenue: RM54.2 million
Loss Before Tax: (RM3.4 million)
Loss After Tax: (RM4.5 million)
Earnings Per Share: (1.24 sen)
While revenue saw a slight decrease of 2.2% due to a temporary reduction in sales orders from a major customer, the Group successfully turned a pre-tax loss of RM3.4 million into a pre-tax profit of RM6.2 million. This impressive turnaround was primarily attributed to a significant one-off disposal gain from the sale of a property in Senai.
Year-to-Date Performance (9M FY2025 vs 9M FY2024)
Current Period (31 March 2025)
Revenue: RM166.6 million
Loss Before Tax: (RM7.0 million)
Loss After Tax: (RM8.1 million)
Loss Per Share: (2.03 sen)
Corresponding Period (31 March 2024)
Revenue: RM103.0 million
Loss Before Tax: (RM21.5 million)
Loss After Tax: (RM23.3 million)
Loss Per Share: (5.70 sen)
Looking at the cumulative nine-month performance, TOMYPAK’s revenue surged by RM63.6 million, largely thanks to the consolidation of EB Packaging Sdn Bhd (EBP)’s sales for the full nine months, compared to only five months in the previous corresponding period. The pre-tax loss significantly narrowed by 67.4% to RM7.0 million, benefiting from the aforementioned disposal gain and EBP’s profit contribution.
Quarter-on-Quarter Comparison (Q3 FY2025 vs Q2 FY2025)
Compared to the immediate preceding quarter (Q2 FY2025), revenue for Q3 FY2025 decreased by 7.0% to RM53.0 million, primarily due to fewer working days. However, the Group successfully transitioned from a pre-tax loss of RM7.6 million in Q2 FY2025 to a pre-tax profit of RM6.2 million in Q3 FY2025, underscoring the positive impact of the one-off gain.
Segmental Performance: Local vs. Export
The Group’s operations are divided between local (Malaysia) and export markets (primarily Southeast Asia and Africa). For the current quarter, local revenue saw an increase to RM28.2 million from RM25.7 million in the same quarter last year, while export revenue decreased to RM24.8 million from RM28.5 million. On a year-to-date basis, both local and export revenues have significantly increased, reflecting the broader impact of EBP’s consolidation.
| Revenue | 3 Months Ended 31.03.2025 (RM’000) | 3 Months Ended 31.03.2024 (RM’000) | 9 Months Ended 31.03.2025 (RM’000) | 9 Months Ended 31.03.2024 (RM’000) |
|---|---|---|---|---|
| – Local | 28,187 | 25,666 | 89,270 | 42,844 |
| – Export | 24,828 | 28,525 | 77,316 | 60,167 |
| Total | 53,015 | 54,191 | 166,586 | 103,011 |
Financial Health: Balance Sheet and Cash Flow
As at 31 March 2025, the Group’s total assets stood at RM290.8 million, down from RM352.6 million as at 30 June 2024. This reduction is largely due to the disposal of assets previously classified as held for sale. Total equity decreased slightly to RM144.2 million from RM151.6 million, while total liabilities saw a substantial decrease to RM146.6 million from RM201.0 million, driven by significant repayments of loans and borrowings.
Notably, the Group’s total borrowings decreased from RM115.0 million to RM83.1 million, reflecting a proactive approach to debt management. Cash and cash equivalents, however, saw a decrease from RM33.4 million to RM25.7 million.
From a cash flow perspective, net cash from operating activities improved to RM8.4 million for the nine-month period, up from RM7.4 million in the prior period. Net cash from investing activities saw a remarkable turnaround, becoming a net inflow of RM21.9 million compared to a net outflow of RM68.7 million previously. This significant shift was primarily due to the proceeds from the disposal of assets held for sale. Net cash used in financing activities was RM38.0 million, reflecting the repayment of term loans and hire purchase liabilities.
Risk and Prospect Analysis: Charting the Future Course
TOMYPAK’s management remains steadfast in its focus on ensuring a smooth integration of its two key entities, TOMYPAK Flexible Packaging (TFP) and EB Packaging (EBP). The aim is clear: to enhance operational efficiency and unlock synergies that will drive future growth. This integration is already showing promising signs of bearing fruit.
EBP continues to demonstrate strong cost management by maintaining optimal operational capacity. Meanwhile, TFP is gradually increasing its output, bolstered by securing additional commercial orders from key customers. The company highlighted making significant progress in the commercialization of new orders, moving from initial product sampling to gaining rigorous customer approvals. This diligent process has recently led to securing a substantial order from a new Indonesian customer, with expectations for consistent future orders. Furthermore, TOMYPAK has also reacquired additional orders from its Philippines customers, signaling renewed confidence and market penetration in the region.
While the report highlights positive operational and strategic developments, it’s prudent to consider potential challenges. The earlier mentioned temporary reduction in sales orders from a major customer indicates that market demand fluctuations can impact revenue. The rigorous qualification requirements for new orders also suggest that securing and maintaining new business can be a complex and time-consuming process. Global economic uncertainties, fluctuating raw material prices, and intense competition within the flexible packaging industry are inherent risks that TOMYPAK, like any other player, must continuously navigate.
The strategies adopted, such as focusing on integration, cost optimization, and aggressive pursuit of new commercial orders, are crucial for mitigating these potential headwinds and sustaining the positive momentum generated in the current quarter.
Summary and Outlook
TOMYPAK Holdings Berhad’s third quarter report for FY2025 paints a picture of a company undergoing a strategic transformation. The significant turnaround to profitability, primarily driven by the disposal of non-core assets, has provided a much-needed boost to its financial position. Coupled with the successful integration efforts of EB Packaging Sdn Bhd and the securing of new orders from key regional markets, the Group appears to be laying a solid foundation for future growth.
The focus on operational efficiency and unlocking synergies between its entities is a sound strategy to navigate the competitive landscape. While the company still reports a year-to-date loss, the substantial reduction in this loss and the positive quarterly profit indicate a strong trajectory towards sustainable profitability.
Key positive factors from this report include:
- A significant turnaround from a quarterly pre-tax loss to a pre-tax profit, largely due to a one-off asset disposal gain.
- Substantial reduction in year-to-date losses, demonstrating improved underlying performance.
- Increased revenue on a year-to-date basis, driven by the consolidation of EBP.
- Proactive management of debt, with a significant reduction in total borrowings.
- Successful integration efforts between TFP and EBP, aimed at enhancing operational efficiency and synergy.
- Securing new and reacquired orders from international customers, indicating market expansion and renewed customer confidence.
Looking ahead, TOMYPAK’s commitment to strategic integration, cost control, and market expansion through new orders positions it favorably. The market will be watching closely to see if the momentum from new commercial orders can offset potential revenue volatility and if the synergies from the integration translate into sustained operational improvements and profitability.
What Are Your Thoughts?
TOMYPAK’s journey through strategic disposals and operational integration is certainly one to watch. The shift to profitability in the quarter, while partly one-off, is a positive signal, and the efforts to secure new business are encouraging. Do you think TOMYPAK can maintain this positive momentum from new customer orders and operational synergies to achieve sustained profitability in the coming quarters? Share your insights in the comments section below!
