Another quarter, another deep dive into the financial heartbeat of Malaysian companies! Today, we’re unpacking the latest interim financial report for the fourth quarter ended 31st March 2025 from IRIS Corporation Berhad. This report gives us a crucial glimpse into the company’s performance, strategic direction, and financial health as it navigates a dynamic market landscape.
While the latest quarter presented some headwinds, leading to a dip in revenue and profit compared to the same period last year, IRIS Corporation has managed to maintain a positive full-year profit. Adding a sweet note for shareholders, the company announced two interim dividends, totaling 2 sen per ordinary share for the financial year. This signals a commitment to returning value, even amidst ongoing challenges. Let’s peel back the layers and explore the numbers that define IRIS Corporation’s journey.
Q4 FY2025: A Closer Look at the Latest Quarter
The fourth quarter of the financial year ending 31st March 2025 saw IRIS Corporation facing some specific challenges. Here’s how the key figures stack up against the same period last year:
Current Quarter (3 Months Ended 31st March 2025)
Revenue: RM42,153,000
Profit Before Taxation: RM3,120,000
Profit for the Period: RM1,350,000
Basic Earnings Per Share: 0.17 sen
Same Period Last Year (3 Months Ended 31st March 2024)
Revenue: RM46,137,000
Profit Before Taxation: RM5,077,000
Profit for the Period: RM4,321,000
Basic Earnings Per Share: 0.53 sen
Revenue for the quarter decreased by approximately 8.5% to RM42.2 million from RM46.1 million in the comparable quarter last year. This was primarily attributed to lower delivery volumes of e-passports and e-ID cards. Consequently, profit before taxation saw a more significant decline of about 38.5%, falling to RM3.1 million from RM5.1 million previously. The profit for the period also experienced a substantial drop of nearly 68.8%.
Full Financial Year 2025 Performance
Despite the challenging fourth quarter, the full financial year figures provide a broader perspective on IRIS Corporation’s performance:
Full Year (12 Months Ended 31st March 2025)
Revenue: RM221,001,000
Profit Before Taxation: RM33,366,000
Profit for the Period: RM23,909,000
Basic Earnings Per Share: 2.91 sen
Previous Full Year (12 Months Ended 31st March 2024)
Revenue: RM371,108,000
Profit Before Taxation: RM40,380,000
Profit for the Period: RM32,244,000
Basic Earnings Per Share: 3.95 sen
For the full financial year, revenue stood at RM221.0 million, a decrease of approximately 40.5% from RM371.1 million in the previous year. Profit before taxation for the year also declined by about 17.4% to RM33.4 million, and profit for the period decreased by nearly 26.0% to RM23.9 million. This indicates a contraction in overall business volume compared to the previous financial year.
Segmental Performance: Trusted ID & IT Division
The primary driver of IRIS Corporation’s business is its Trusted ID & IT Division. In the current quarter, this division recorded revenue of RM41.5 million, a 10.0% decrease compared to RM46.1 million in the same quarter last year. This dip was largely due to lower deliveries of e-Passports and e-ID cards. The “Other Divisions” did not contribute significantly to the group’s performance in this quarter.
Quarter-on-Quarter Comparison: Q4 FY2025 vs Q3 FY2025
Comparing the latest quarter to the immediately preceding quarter (Q3 FY2025) reveals further insights:
| Metric | Q4 FY2025 (RM’000) | Q3 FY2025 (RM’000) | Change (%) |
|---|---|---|---|
| Revenue | 42,153 | 56,800 | -25.7% |
| Profit Before Taxation | 3,120 | 11,100 | -72.1% |
Revenue decreased by approximately 25.7% from RM56.8 million in the preceding quarter, mainly due to lower delivery of e-ID cards for overseas projects. The profit before taxation saw an even steeper decline of about 72.1%, falling from RM11.1 million to RM3.1 million. A key factor for this sharp drop was the recognition of an impairment loss on goodwill in the current financial quarter.
Financial Health: Balance Sheet and Cash Flow
Examining the balance sheet and cash flow statements provides a holistic view of the company’s financial standing:
Balance Sheet Snapshot (as at 31st March 2025)
- Total Assets: RM602,789,000 (compared to RM632,306,000 as at 31st March 2024)
- Total Equity: RM385,593,000 (compared to RM377,549,000 as at 31st March 2024) – a modest increase of about 2.1%
- Net Assets Per Ordinary Share: 47.48 sen (compared to 46.51 sen as at 31st March 2024) – showing a slight improvement in shareholder value.
- Cash and Short-term Deposits: RM165,862,000 (compared to RM160,466,000 as at 31st March 2024) – a healthy cash position, increasing by approximately 3.4%.
- Short-term Borrowings: RM1,763,000 (compared to RM3,210,000 as at 31st March 2024) – a significant reduction of about 45.1%, indicating improved debt management.
Cash Flow Dynamics (12 Months Ended 31st March 2025)
- Net Cash from Operating Activities: RM16,038,000 (compared to RM38,687,000 in FY2024) – a substantial decrease of approximately 58.6%, indicating less cash generated from core operations.
- Net Cash from Investing Activities: RM7,276,000 (compared to RM(3,399,000) in FY2024) – a positive shift, driven by proceeds from the disposal of a subsidiary and forfeiture income.
- Net Cash Used in Financing Activities: RM(17,834,000) (compared to RM(581,000) in FY2024) – a higher outflow, primarily due to the interim dividends paid to owners of the Company.
Overall, IRIS Corporation maintains a strong balance sheet with increasing equity and cash reserves, alongside reduced short-term debt. However, the significant decline in operating cash flow for the full year is a point to observe, compensated partly by positive investing activities.
Risks and Prospects: Navigating the Future
Looking ahead, IRIS Corporation acknowledges both opportunities and challenges. The company’s growth is expected to be primarily driven by the continued delivery and supply of eID cards and e-Passports, leveraging existing and new customer relationships. There’s a clear strategic focus on expanding its core Trusted ID and adjacent IT businesses in both international and domestic markets. Furthermore, cost optimization efforts remain a priority to ensure competitiveness and sustainable long-term growth.
The Board expresses cautious optimism for the financial year ending 31st March 2026, anticipating positive performance from ongoing deliveries to overseas customers.
However, the report also highlights several material litigations that could impact the company:
- Arbitration with Kementerian Dalam Negeri (KDN): IRIS Information Technology Systems Sdn Bhd (IITS) has initiated arbitration proceedings against KDN following the termination of the NIISe Contract. The outcome of these proceedings, scheduled for hearing in December 2025, could significantly affect the Group’s financial performance.
- Lawsuit by Tec D Distribution (Malaysia) Sdn. Bhd.: Tec D is claiming an outstanding sum of RM30,139,099 from IITS and IRIS Corporation Berhad related to the NIISe Project. Full trial dates are set for January 2028.
- Appeal against Former Directors: An appeal against the High Court’s dismissal of claims against nine former members of the Board of Directors, concerning an investment in Border Control Solutions Limited, was completed on March 26, 2025, with a decision fixed for June 17, 2025.
The impairment loss on goodwill recognized in the current quarter, along with higher non-deductible expenses contributing to a higher effective tax rate, are also factors to consider when evaluating the company’s financial resilience.
Summary and
IRIS Corporation Berhad’s latest quarterly report presents a mixed picture. While the fourth quarter showed a contraction in revenue and profit, largely due to reduced e-passport and e-ID card deliveries, the full financial year remained profitable. The company’s commitment to shareholder returns is evident through its dividend payments. Its balance sheet remains robust with healthy cash reserves and reduced short-term debt, providing a solid foundation.
Strategically, IRIS is focused on leveraging its core competencies in the Trusted ID and IT sectors, with an optimistic outlook for continued growth in these areas, particularly in overseas markets. However, potential investors should be mindful of the significant legal challenges outlined in the report, especially the arbitration concerning the NIISe contract and the Tec D lawsuit, which could introduce volatility. The recent impairment loss on goodwill also warrants attention.
Key risk points to monitor:
- The outcome and financial impact of the NIISe contract arbitration.
- The progress and potential financial implications of the lawsuit by Tec D Distribution.
- The resolution of the appeal against former directors regarding the BCS investment.
- The company’s ability to manage and mitigate further impairment losses on assets.
- Sustaining cash flow from operating activities amidst fluctuating project deliveries.
As a reminder, this analysis is for informational purposes only and should not be construed as investment advice. Always conduct your own thorough due diligence before making any investment decisions.
What are your thoughts on IRIS Corporation’s latest performance and its strategic direction? Do you think the company can maintain its positive momentum and navigate the ongoing legal challenges effectively in the coming financial year? Share your insights in the comments below!
For more in-depth analyses of Malaysian companies, stay tuned to our blog!
