Hello, fellow investors and market watchers! We’re diving deep into the latest financial performance of Harbour-Link Group Berhad, a diversified Malaysian conglomerate with interests spanning shipping, logistics, machinery, and property development. Their unaudited condensed consolidated report for the 3rd quarter and financial period ended 31st March 2025 has just been released, and it offers some interesting insights into their operational health and strategic direction.
The report highlights a robust full-year profit growth, signaling a positive trajectory for the Group, despite some segments facing market challenges. Let’s unpack the numbers and see what’s driving Harbour-Link’s performance and what lies ahead.
Core Financial Highlights: A Tale of Growth (Mostly)
Harbour-Link Group Berhad has shown commendable growth in its cumulative nine-month performance, although the latest quarter presented a mixed picture. Here’s a snapshot of the key financial figures:
Cumulative Period (9 Months Ended 31 March 2025 vs. 31 March 2024)
Current Period (31/03/2025)
Revenue: RM772.88 million
Profit Before Tax (PBT): RM111.37 million
Net Profit: RM95.68 million
Basic Earnings Per Share (EPS): 20.23 sen
Preceding Period (31/03/2024)
Revenue: RM700.51 million
Profit Before Tax (PBT): RM85.99 million
Net Profit: RM72.66 million
Basic Earnings Per Share (EPS): 14.46 sen
For the cumulative nine months, the Group’s revenue increased by 10% to RM772.88 million, up from RM700.51 million in the same period last year. This translated into an impressive 30% surge in Profit Before Tax (PBT) to RM111.37 million, and Net Profit climbed by 32% to RM95.68 million. Basic Earnings Per Share (EPS) also saw a significant jump of 40%, reaching 20.23 sen.
Current Quarter (Q3 FY2025: 31 March 2025 vs. 31 March 2024)
Current Quarter (31/03/2025)
Revenue: RM243.45 million
Profit Before Tax (PBT): RM34.66 million
Net Profit: RM30.87 million
Basic Earnings Per Share (EPS): 6.78 sen
Corresponding Quarter (31/03/2024)
Revenue: RM257.81 million
Profit Before Tax (PBT): RM35.15 million
Net Profit: RM29.53 million
Basic Earnings Per Share (EPS): 6.06 sen
Looking at the latest quarter alone, revenue dipped by 6% to RM243.45 million compared to RM257.81 million in the corresponding quarter last year. PBT also saw a slight decrease of 1% to RM34.66 million. However, net profit for the quarter still managed to increase by 5% to RM30.87 million, and EPS improved by 12% to 6.78 sen.
Key Highlight: The Group announced a first interim dividend of 3.0 sen net per ordinary share for the financial year ending 30 June 2025, which was paid on 3rd April 2025. This demonstrates the company’s commitment to returning value to shareholders.
Segmental Performance: A Closer Look at the Engines of Growth
Harbour-Link’s diverse business units contribute differently to its overall performance. Here’s how each segment fared for the cumulative nine months:
Shipping and Marine Segment
This segment continues to be a strong performer, with revenue increasing by 15% to RM490.84 million. PBT for this segment soared by a remarkable 65% to RM82.97 million. The significant increase in profit is attributed to additional tonnage carried and higher freight rates, indicating robust demand and efficient operations in the shipping sector.
Integrated Logistics Segment
Revenue for integrated logistics grew by 18% to RM176.09 million. However, PBT for this segment decreased by 14% to RM21.56 million. The report indicates that increased overhead costs due to project delays and an impairment of trade receivables of RM1.17 million contributed to this decline in profitability, despite the higher revenue.
Machineries Trading Segment
This segment experienced a decline, with revenue decreasing by 13% to RM80.53 million and PBT falling by 43% to RM8.16 million. The main reason cited is the completion of a significant project involving the supply, delivery, installation, and commissioning of two Quay Cranes in the preceding financial period.
Engineering Segment
Revenue for the engineering segment decreased by 7% to RM23.81 million. Despite the revenue dip, the segment turned a loss into a profit, recording a PBT of RM0.27 million compared to a net loss of RM1.40 million in the previous corresponding period. This improvement in profitability, despite lower revenue, is due to projects reaching their tail end, suggesting better cost management or completion of less profitable ventures.
Property Development Segment
This segment faced significant headwinds, with revenue plummeting by 76% to RM1.61 million and a PBT of RM(0.38) million, a substantial decline from a profit of RM3.03 million last year. The report directly attributes this to “no sales of properties,” indicating a challenging period for their property division.
Investment Holding Segment
This segment recorded a higher loss before tax of RM3.46 million, compared to a loss of RM2.73 million in the preceding period, primarily due to an increase in overhead costs.
Financial Health: Balance Sheet and Cash Flow
Harbour-Link’s balance sheet remains strong. As at 31 March 2025, total assets increased to RM1,256.39 million from RM1,165.73 million as at 30 June 2024. Total equity also grew to RM999.30 million from RM933.92 million, reflecting a healthy financial position and an increase in Net Assets Per Share to RM2.16 from RM2.02.
From a cash flow perspective, the Group generated RM100.41 million from operating activities for the nine-month period, up from RM85.21 million in the prior year. However, net cash used in investing activities saw a significant outflow of RM72.56 million (compared to an inflow of RM7.01 million last year), primarily due to higher acquisition of property, plant and equipment (RM65.08 million vs RM29.74 million) and investment securities. Net cash used in financing activities decreased significantly to RM5.38 million from RM34.48 million, mainly due to lower dividend payments and net proceeds from lease payables.
Risks and Prospects: Navigating the Future
Harbour-Link is cautiously optimistic about its future, while acknowledging potential challenges:
- Shipping and Logistics: While the Container Liner Division experienced lower volumes during festive periods and faces stiff competition, the Group expects efficient performance. The Shipping Agency and Integrated Logistics Divisions are anticipated to remain stable with consistent cargo volumes.
- Engineering and Machineries: New contracts for mechanical engineering work in tank construction, scheduled to commence in August 2025, are expected to drive activity in FY2026. Furthermore, rising demand for earthworks machinery in road construction and agriculture sectors is projected to positively impact sales in upcoming quarters.
- Strategic Investment: The Group is allocating capital expenditure (Capex) towards renewing its ageing fleet of vessels and transport vehicles. This strategic move aims to enhance operational efficiency, reduce maintenance costs, and ensure compliance with ESG standards, which is crucial for long-term sustainability.
- External Factors: The Group remains vigilant regarding global geopolitical developments and potential shifts in international trade policies, such as the Trump Administration’s tariff policies, as these could introduce uncertainties to the Malaysian economy.
Summary and
Harbour-Link Group Berhad’s latest quarterly report paints a picture of a company with strong underlying growth, particularly driven by its core shipping and marine segment. While some segments like machineries trading and property development faced headwinds, the Group’s cumulative nine-month performance demonstrates resilience and strategic adaptation. The commitment to fleet renewal and securing new engineering contracts indicates a proactive approach to future growth and operational efficiency. The Group’s financial health appears solid, with healthy balance sheet growth and positive operating cash flows.
Key areas to watch for future performance include:
- The ability of the Shipping and Marine segment to sustain higher freight rates and cargo volumes amidst competition.
- The successful execution and profitability of new mechanical engineering contracts starting in FY2026.
- The recovery of the property development segment and sales of properties.
- The impact of global geopolitical and trade policies on the Malaysian economy and, consequently, on the Group’s diversified operations.
- The effectiveness of the fleet renewal program in enhancing efficiency and reducing costs.
Harbour-Link’s strategic investments in fleet renewal and diversification into new engineering contracts suggest a forward-looking management team focused on long-term value creation and operational resilience. Their ability to navigate market dynamics and capitalize on opportunities will be key to their continued success.
What are your thoughts on Harbour-Link’s latest performance? Do you believe their strategy to renew their fleet and secure new engineering projects will pay off in the coming years? Share your insights in the comments below!
For more in-depth analysis of Malaysian companies, stay tuned to our blog for future updates!
