OMESTI BERHAD’s Q4 FY2025 Report: A Glimmer of Profit Amidst Strategic Shifts
Greetings, fellow investors and market enthusiasts! Today, we’re diving into the latest quarterly report from OMESTI BERHAD, a prominent Malaysian technology solutions provider. This report, covering the fourth quarter ended 31 March 2025, offers a crucial look into the company’s performance and strategic direction. While the full financial year saw a loss, the current quarter presents a notable turnaround, signaling potential shifts in the company’s trajectory. Let’s break down the key highlights and what they mean for OMESTI’s future.
Key Financial Highlights: A Quarterly Turnaround
OMESTI BERHAD recorded a profit before tax of RM1.549 million for the current quarter, a significant improvement compared to the immediate preceding quarter. This positive shift is primarily attributed to better cost control and reduced financing costs, alongside progress billing from its Business Performance Services segment.
Quarter-on-Quarter Performance (31 March 2025 vs 31 December 2024)
Current Quarter (31 Mar 2025)
Revenue: RM17.287 million
Profit Before Tax: RM1.549 million
Previous Quarter (31 Dec 2024)
Revenue: RM19.512 million
Loss Before Tax: RM(5.421) million
As you can see, revenue for the current quarter saw an 11.4% decrease compared to the immediate preceding quarter, mainly due to lower order fulfillment and progress billing from Business Performance Services. However, the move from a loss to a profit before tax is a strong indicator of improved operational efficiency and financial management.
Full Financial Period Performance (Twelve Months Ended 31 March 2025)
It’s important to note that OMESTI BERHAD has changed its financial year end from 31 March to 30 June. As such, there is no comparative financial information available for the preceding year’s corresponding period in this report. However, we can look at the cumulative performance for the twelve months ended 31 March 2025:
| Metric | Twelve Months Ended 31 Mar 2025 (RM’000) |
|---|---|
| Revenue | 70,562 |
| Loss Before Tax | (21,513) |
| Loss for the Financial Period | (21,623) |
| Loss Attributable to Owners of the Parent | (22,373) |
| Basic and Diluted Loss Per Share (sen) | (4.14) |
Despite the quarterly profit, the full twelve-month period still reflects a net loss, indicating the challenges faced throughout the year. The profit in the latest quarter suggests a positive momentum shift towards the end of this financial reporting cycle.
Diving Deeper: Segmental Performance and Financial Health
Business Segment Contributions (Twelve Months Ended 31 March 2025)
OMESTI’s operations are diversified across several key segments. Here’s how they contributed to the full-year revenue and segment results:
| Business Segment | External Revenue (RM’000) | Segment Result (RM’000) |
|---|---|---|
| Business Performance Services | 43,556 | (377) |
| Digital & Infrastructure Services | 57 | (262) |
| Healthcare Services | 26,210 | 2,100 |
| Others | 739 | 2,374 |
The Business Performance Services segment remains the largest revenue contributor, and its order fulfilments were crucial for the latest quarter’s profit. Healthcare Services and ‘Others’ segments showed positive segment results, indicating their profitability contributions.
Balance Sheet Snapshot (as at 31 March 2025)
A look at the balance sheet provides insights into the company’s financial health:
As at 31 Mar 2025
Total Assets: RM273.629 million
Total Equity: RM47.237 million
Total Liabilities: RM226.392 million
Net Assets Per Share: RM0.0806
Cash and Cash Equivalents (Net): RM3.898 million
Current Borrowings: RM17.249 million
Non-Current Borrowings: RM0 million
As at 31 Mar 2024
Total Assets: RM348.150 million
Total Equity: RM68.670 million
Total Liabilities: RM279.480 million
Net Assets Per Share: RM0.1216
Cash and Cash Equivalents (Net): RM(820) thousand
Current Borrowings: RM62.467 million
Non-Current Borrowings: RM1.028 million
A notable positive development is the significant reduction in borrowings, particularly current borrowings, from RM62.467 million to RM17.249 million. This deleveraging effort has contributed to the reduced finance costs mentioned earlier and strengthens the company’s financial structure. Total assets and equity have decreased, partly due to the full-year loss and other balance sheet adjustments.
Prospects and Potential Headwinds
Looking ahead, OMESTI BERHAD highlights several key prospects that could shape its future performance:
- Reduced Borrowings and Financing Costs: The company has successfully continued to reduce its borrowings, which will positively impact its interest payments going forward. This is a crucial step towards improving profitability.
- eCourts Project: OMESTI has recently secured the next phase of the eCourts project. This is expected to significantly enhance revenue from the end of calendar year 2025, providing a strong growth driver.
- Balance Sheet Management: The group intends to further address its balance sheet in the near future, which could involve further optimization of assets and liabilities.
However, like any company, OMESTI faces certain risks and challenges. One significant area to monitor is the ongoing material litigation:
- Litigation with Foster Moore International Limited: This matter has been amicably settled via a consent order, which is a positive development as it removes a potential financial overhang.
- Litigation with Suruhanjaya Syarikat Malaysia (SSM): This case, involving alleged liquidated ascertained damages and claims for breach of contract, is ongoing with trial dates set for September and November 2025, and February 2026. The outcome of this litigation could have a material impact on the company.
The change in financial year end also means that direct year-on-year comparisons for the corresponding periods are not available, which might require investors to adjust their analysis methods for a clearer picture of long-term trends.
Summary and
OMESTI BERHAD’s fourth-quarter report for FY2025 shows a promising return to quarterly profitability, driven by effective cost control and reduced financing expenses. While the full financial year still reflects a loss, the positive momentum in the latest quarter, coupled with strategic wins like the eCourts project and continued debt reduction, paints a picture of a company actively working towards a stronger financial footing.
The successful settlement of one major litigation is encouraging, but the ongoing case with SSM remains a key risk factor to monitor. The company’s efforts to enhance revenue through new projects and strengthen its balance sheet are positive indicators for its future prospects.
It is important to note that this analysis is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should conduct their own due diligence and consult with a qualified financial advisor before making any investment decisions.
Key points to watch for OMESTI BERHAD moving forward include:
- The sustained profitability of its business segments, especially Business Performance Services.
- The impact of the new eCourts project on future revenues and profitability.
- Further developments in the ongoing litigation with SSM.
- The results of the company’s efforts to further address its balance sheet.
What are your thoughts on OMESTI BERHAD’s latest performance? Do you believe the company can maintain this positive momentum and successfully leverage its new eCourts project to return to sustained profitability? Share your views and insights in the comments section below!
