Bina Puri Holdings Bhd: Navigating a Turnaround Amidst Legal Headwinds
Malaysian investors, grab your kopi-o! Bina Puri Holdings Bhd, a well-known diversified Malaysian group with interests spanning construction, property, quarry, and power supply, has just released its latest quarterly report for the financial period ended 31 March 2025. This report offers a fascinating glimpse into the company’s operational recovery, showcasing a significant turnaround in its profitability. However, a closer look reveals persistent financial and legal challenges that demand attention. Join us as we dissect the numbers and uncover the key takeaways from this crucial update.
Key Highlight: Bina Puri Holdings Bhd has successfully turned around its nine-month performance, moving from a pre-tax loss to a pre-tax profit, driven by robust growth in its construction and property segments. This marks a significant step forward in the company’s journey.
Core Financial Performance: A Strong Rebound
Bina Puri’s latest report demonstrates a remarkable improvement in its financial health over the nine-month period. Let’s dive into the key figures that paint this picture of recovery.
Revenue Growth and Profitability Turnaround (Nine Months Ended 31 March 2025)
Revenue
Current Period: RM216.16 million
Revenue
Same Period Last Year: RM136.62 million
The Group’s revenue for the nine months ended 31 March 2025 surged by an impressive 58.21% to RM216.16 million, compared to RM136.62 million in the previous corresponding period. This substantial increase signals a stronger operational pipeline and market activity.
Profit Before Tax (PBT)
Current Period: RM3.69 million
Loss Before Tax (LBT)
Same Period Last Year: RM(9.01) million
Perhaps the most compelling highlight is the swing from a pre-tax loss of RM9.01 million in the previous corresponding period to a pre-tax profit of RM3.69 million. This turnaround is a testament to the Group’s efforts in improving its operational efficiency and securing profitable projects.
Profit Attributable to Owners
Current Period: RM1.89 million
Loss Attributable to Owners
Same Period Last Year: RM(14.89) million
Similarly, the net profit attributable to owners of the Company reversed from a loss of RM14.89 million to a profit of RM1.89 million, directly impacting the basic earnings per share, which improved from a loss of (0.44) sen to a profit of 0.26 sen.
Quarter-on-Quarter Performance
Comparing the current quarter (3 months ended 31 March 2025) to the immediate preceding quarter, the Group recorded a pre-tax profit of RM1.4 million, a 75% increase from RM0.8 million in the previous quarter. This positive momentum is primarily attributed to higher profit contributions from the property segment.
Segmental Performance: The Driving Forces
A deeper dive into the business segments reveals the key drivers behind the Group’s improved performance:
- Construction Segment: Revenue skyrocketed to RM84.22 million for the nine months ended 31 March 2025, a massive increase from RM16.24 million in the previous corresponding period. This impressive 418.6% growth, fueled by ongoing projects and new contract wins, significantly reduced the segment’s loss before tax from RM6.67 million to RM5.02 million.
- Property Segment: This segment continued its strong trajectory, reporting a revenue of RM104.23 million (up 11.7%) and a pre-tax profit of RM14.86 million for the nine months ended 31 March 2025. This marks a substantial 232.4% increase in profit compared to RM4.47 million in the prior year, driven by higher property sales and improved retail mall operations.
- Power Supply Segment: While revenue remained stable at around RM6.42 million, the segment successfully reduced its loss before tax by 59.1%, from RM3.13 million to RM1.28 million. This improvement was mainly due to better operational efficiencies and favorable foreign exchange rates.
Balance Sheet and Cash Flow Snapshot
The Group’s financial position as at 31 March 2025 also shows signs of strengthening:
| Metric | 31 March 2025 (RM’000) | 30 June 2024 (RM’000) | Change (%) |
|---|---|---|---|
| Total Assets | 909,953 | 887,512 | 2.53% |
| Total Equity | 236,410 | 195,254 | 21.08% |
| Net Assets Per Share (RM) | 0.1593 | 0.1293 | 23.20% |
| Total Borrowings | 331,080 | 352,815 | (6.16%) |
The increase in total equity and net assets per share reflects the improved profitability and successful capital-raising initiatives, including the private placement that raised RM38.2 million. Notably, total borrowings have also seen a slight reduction, which is a positive sign for financial stability.
However, the cash flow statement presents a mixed picture. Net operating cash flows for the nine months ended 31 March 2025 were a negative RM28.12 million, a significant shift from the positive RM36.83 million in the previous corresponding period. This indicates that while the company is generating profit, its core operations are consuming cash, which could be a point of concern. On the other hand, financing activities provided a net cash inflow of RM20.31 million, largely due to the proceeds from the issuance of shares, offsetting some of the operational cash outflow.
Risks and Prospects: Navigating the Road Ahead
Bina Puri Holdings Bhd is operating in dynamic sectors with promising outlooks, but like any business, it faces its share of challenges.
Promising Prospects
The Group is optimistic about the future, particularly in Malaysia’s construction and property sectors:
- Construction Sector: Projected to expand by 6% in real terms in 2025, driven by substantial public infrastructure investments. The Group anticipates continued growth from strategic infrastructure projects, rapid urbanisation, and strong government support, especially with significant developments in East Malaysia like the Northern Coastal Highway in Sarawak and the Sabah-Sarawak Link Road Phase 2.
- Property Sector: Expected to register steady growth in 2025, supported by improving market sentiment, ongoing infrastructure development, and government incentives. Residential demand is particularly anticipated to drive performance.
Leveraging its extensive expertise and established market presence, Bina Puri plans to actively bid for new contracts to expand its order book and ensure the timely completion of its ongoing projects.
Key Challenges and Risks
Despite the operational improvements, the Group highlights its high gearing and ongoing negotiations with banks to restructure payment obligations. This is a critical area to monitor, as effective debt management is crucial for long-term sustainability. Furthermore, the company is involved in several material litigations, some of which carry substantial financial implications and could impact future cash flows and financial stability.
Summary and
Bina Puri Holdings Bhd’s latest quarterly report paints a picture of a company in transition. The significant turnaround in profitability, particularly driven by its construction and property segments, is a commendable achievement and signals a positive shift in its operational performance. The Group’s strategic focus on securing new projects in a growing market positions it well for future revenue generation.
However, the report also underscores the financial complexities the Group is navigating. The negative operating cash flow, combined with the high gearing and a series of material litigations, presents a challenging environment. While the reduction in overall borrowings and proceeds from the private placement offer some relief, the ongoing legal battles, particularly the winding-up petitions, introduce a degree of uncertainty.
For Malaysian retail investors, it’s essential to understand that while operational improvements are encouraging, the resolution of these financial and legal headwinds will be critical for the company’s sustained recovery and long-term stability. The management’s efforts to restructure debt and address litigations will be key determinants of future performance.
Key risk points to monitor closely include:
- The ongoing negotiations with banks to restructure the Group’s high borrowings and payment obligations.
- The enforcement and recovery of the arbitration award in the Pakistan litigation, and the associated challenges.
- The outcome of the appeal and stay of execution regarding the RM28.17 million judgment in the Wisma Majujaya case, especially given the winding-up petition received.
- The resolution of the winding-up petition from Export-Import Bank of Malaysia Berhad concerning the USD-denominated loan.
- The outcome of other pending winding-up petitions and material litigations, which could impact the Group’s financial position and reputation.
