Ekovest Berhad’s Latest Financials: A Deep Dive into Q3 FY2025 Performance and Strategic Moves
May 31, 2025
Malaysian investors, let’s turn our attention to Ekovest Berhad, a diversified group with interests spanning construction, property development, toll operations, and plantations. The company has just released its unaudited financial results for the third quarter ended 31 March 2025 (Q3 FY2025). This report offers a mixed bag of results, with a notable improvement in the latest quarter’s profitability, yet a challenging picture emerges for the financial year-to-date. But beyond the numbers, Ekovest is actively pursuing significant strategic initiatives that could reshape its future. Let’s break down what this report tells us.
Core Financial Highlights: A Tale of Two Timelines
Ekovest’s latest quarter shows a positive shift, driven by specific segment performance. However, the cumulative year-to-date figures reflect the impact of higher financing costs and other operational factors.
Quarterly Performance (Q3 FY2025 vs Q3 FY2024)
For the quarter ended 31 March 2025, Ekovest recorded a **profit before tax of RM18.613 million**, a significant increase of 30.76% from RM14.234 million in the same quarter last year.
Revenue also saw a modest increase of 1.56%, reaching RM311.238 million compared to RM306.462 million previously.
Net profit for the period surged by an impressive 446.45% to RM15.940 million, up from RM2.917 million.
Loss attributable to owners of the Company improved by 12.23%, narrowing to RM(9.750) million from RM(11.109) million.
Q3 FY2025
Revenue: RM311,238,000
Profit Before Tax: RM18,613,000
Net Profit: RM15,940,000
Basic Loss per Share: (0.33) sen
Q3 FY2024
Revenue: RM306,462,000
Profit Before Tax: RM14,234,000
Net Profit: RM2,917,000
Basic Loss per Share: (0.37) sen
Year-to-Date Performance (YTD FY2025 vs YTD FY2024)
For the nine months ended 31 March 2025, Ekovest reported a **loss before tax of RM(30.427) million**, a significant swing from a profit of RM3.828 million in the corresponding period last year.
Revenue for the period decreased by 7.79% to RM807.156 million from RM875.359 million.
The loss attributable to owners of the Company widened by 35.58% to RM(78.755) million.
YTD FY2025
Revenue: RM807,156,000
(Loss) Before Tax: RM(30,427,000)
(Loss) After Tax: RM(49,314,000)
Basic Loss per Share: (2.66) sen
YTD FY2024
Revenue: RM875,359,000
Profit Before Tax: RM3,828,000
(Loss) After Tax: RM(45,271,000) (This is a loss)
Basic Loss per Share: (1.96) sen
The swing to a loss for the year-to-date is primarily attributed to a substantial increase in financing costs, which rose to RM334.037 million in YTD FY2025 from RM267.560 million previously. This is largely because financing costs for the SPE Highway can no longer be capitalized following its full opening in November 2023. Additionally, the non-receipt of expected toll compensation for DUKE 1 and 2 highways for the 2024 toll rate freeze further impacted the overall financial performance.
Diving Deeper: Performance Across Business Units
Ekovest’s diverse portfolio means understanding each segment’s contribution is key to grasping the overall picture.
Construction Operations
This segment saw a decrease in both revenue and profit for both the quarter and year-to-date. Quarterly revenue fell to RM130.227 million (from RM138.409 million), with profit at RM12.930 million (from RM20.641 million). The primary reason cited is the completion of the Setiawangsa-Pantai Expressway (SPE) project in the previous financial year. Current revenue is mainly from the ongoing Rapid Transit System Link (RTS Link) project, which is progressing well.
Property Development
A shining star in this report, the property development segment recorded significantly higher revenue and profit. Quarterly revenue increased to RM7.385 million (from RM4.407 million), with profit rising to RM0.678 million (from RM0.172 million). Year-to-date, revenue surged to RM103.831 million (from RM19.761 million), and profit to RM21.936 million (from RM2.998 million). This impressive growth was largely driven by the completion and sale of remaining units in the EkoCheras development, as well as the recognition of RM75.181 million in revenue from land disposals through two Sale and Purchase Agreements. The upcoming EkoTitiwangsa project is expected to drive future growth.
Toll Operations
The toll operations segment demonstrated robust growth, driven by increased traffic volume and toll compensation. Quarterly revenue grew by 13.07% to RM141.196 million (from RM124.873 million), with profit reaching RM128.288 million (from RM111.950 million). Year-to-date, revenue increased to RM288.514 million (from RM241.065 million), and profit rose by 21.71% to RM249.999 million (from RM205.408 million). The full opening of the SPE Highway in November 2023 significantly contributed to higher toll collections. The segment also recognized substantial toll compensation related to government toll rate freezes and festive exemptions.
Plantation
The plantation segment experienced a decline in quarterly revenue to RM20.800 million (from RM26.249 million) and year-to-date revenue to RM78.880 million (from RM88.274 million), primarily due to reduced sales of downstream durian products and weaker earnings margins from offshore customers. However, profit for both periods saw an improvement, with a quarterly profit of RM2.871 million (reversing a loss of RM1.598 million) and year-to-date profit of RM21.030 million (from RM12.049 million). This was partially offset by an improvement in the average selling price of fresh fruit bunches (FFB).
Property Investment & Others
This segment saw a slight decline in quarterly revenue to RM11.630 million (from RM12.524 million) and year-to-date revenue to RM35.592 million (from RM37.662 million), mainly due to the scaling down of the F&B division. Despite this, segment profit improved to RM2.264 million for the quarter (from RM0.511 million) and RM7.162 million year-to-date (from RM0.989 million), positively impacted by a higher tenancy occupancy rate at EkoCheras Shopping Mall and reduced operating costs.
Financial Health: Balance Sheet and Cash Flow
As of 31 March 2025, Ekovest’s total assets stood at RM11.201 billion, a slight decrease from RM11.521 billion as at 30 June 2024. Total liabilities also decreased to RM8.436 billion from RM8.705 billion. Net assets per share attributable to owners of the Company were RM0.75 (compared to RM0.77 at 30 June 2024).
The Group’s borrowings saw a decrease compared to the preceding year, mainly due to repayments during the year. Current liabilities for borrowings were RM727.362 million (from RM601.475 million) and non-current liabilities were RM5.494 billion (from RM5.716 billion). The overall decrease in borrowings points to some debt management efforts.
From a cash flow perspective, net cash generated from operating activities was RM192.284 million for the year-to-date (down from RM273.542 million). However, net cash generated from investing activities significantly increased to RM400.309 million (from RM130.430 million), driven by net redemptions of investment funds and proceeds from disposal of property, plant, and equipment. Net cash used in financing activities was RM(455.370) million (from RM(421.692) million).
Strategic Outlook and Potential Risks
Ekovest’s management remains optimistic about future growth, focusing on several key strategic initiatives:
- Toll Operations: Continued growth is expected from DUKE Phase-1 and Phase-2, and the full opening of the SPE Highway. While financing costs are no longer capitalized, increased traffic volume should enhance contributions.
- Property Development: The upcoming EkoTitiwangsa project is slated to drive future growth, building on the success of EkoCheras sales.
- Construction: The ongoing rationalization of the RTS Link project is expected to contribute positively. A significant development is the government’s approval on 5 May 2025 for the proposed privatization of Phase 1 – Project LIKE (Laluan Istana – Kiara Expressway) and Phase 2 – Project KBL (Kampung Baru Link Expressway). This could provide a substantial boost to the construction pipeline.
- Plantation Diversification: The subsidiary, PLS Plantations Berhad, is undergoing a strategic transformation from a traditional oil palm business to a diversified agribusiness, with a key focus on commercial durian. This involves long-term investment in durian plantations (3-4 year gestation period for production) and strengthening downstream durian product retail. This move aims to reduce reliance on core construction and property segments, creating more sustainable, multi-sector revenue streams.
The report also details several ongoing corporate exercises, including:
- Proposed Knusford-ECSB Merger: The proposed merger of Ekovest’s construction arm (ECSB) with Knusford, with an indicative disposal consideration of RM450 million. The deadline for definitive agreements has been extended to 27 July 2025.
- Proposed Transit-Oriented Development (TOD) Land Acquisitions: Acquisition of four parcels of land in Johor Bahru for TOD, located along the Johor Bahru–Singapore Rapid Transit System alignment, for an indicative total of RM310 million. The deadline for definitive agreements has been extended to 27 October 2025.
- Proposed Acquisition of Credence Resources Sdn Bhd: Ekovest proposes to acquire up to 70% equity interest in Credence Resources Sdn Bhd for an indicative purchase consideration of approximately RM1.15 billion. The deadline for definitive agreements has been extended to 27 July 2025.
These proposals are not inter-conditional and will be implemented separately. While they signal ambitious growth plans, the repeated extensions suggest complexities in negotiations or due diligence.
On the litigation front, Ekovest is involved in several arbitration and court proceedings related to the Pan Borneo Highway project. While the maximum exposure to liabilities cannot be ascertained, the company’s solicitors are of the opinion that Ekovest Construction Sdn Bhd (ECSB) has a fair chance of success in its arbitration proceeding, and Ekovest Berhad has a fair chance of success in its defense. The latest updates indicate discontinuance of some claims, suggesting a path towards resolution or reduction of legal overhang.
Dividends
No interim dividend has been declared or paid for the current quarter or year ended 31 March 2025.
Summary and
Ekovest’s Q3 FY2025 report presents a mixed financial picture. While the latest quarter showed a commendable rebound in profitability, driven by strong performance in toll operations and property development, the year-to-date figures highlight challenges, particularly from increased financing costs. The completion of the SPE Highway project has shifted the construction segment’s focus, and the plantation segment is undergoing a strategic transformation with a long-term outlook.
The company is clearly laying the groundwork for future growth through several ambitious corporate exercises and new infrastructure projects. The approval for the LIKE and KBL highway privatization is a significant positive development for its construction and concession businesses. The diversification into agribusiness, particularly durian, represents a long-term strategic pivot, though it comes with a longer gestation period.
Key points to consider from this report include:
- The positive quarterly profit turnaround, largely due to toll compensation and property development gains.
- The impact of higher financing costs on the year-to-date loss, which will continue to be a factor as capitalised costs are expensed.
- The strategic importance of new infrastructure projects like LIKE and KBL for the construction segment’s pipeline.
- The long-term potential and inherent risks of the plantation segment’s transformation into a diversified agribusiness.
- The ongoing corporate exercises (mergers, land acquisitions) which, while extended, indicate the company’s intent for future expansion and value creation.
The Board remains optimistic about the Group’s prospects for the financial year ending 30 June 2025, driven by these strategic initiatives and ongoing projects.
Ekovest Berhad is certainly at an interesting juncture, navigating both operational shifts and ambitious strategic expansions. The focus on high-impact infrastructure projects and a diversified agribusiness model could redefine its earnings profile in the coming years. Do you think Ekovest can successfully execute these large-scale plans and return to sustained profitability? Share your thoughts in the comments below!
