WEST RIVER BERHAD: A Look at Their Inaugural Q1 2025 Performance Post-IPO
Hello, fellow investors and market enthusiasts! Today, we’re diving into the first quarterly financial report of **WEST RIVER BERHAD** for the period ended 31 March 2025. This is a significant report as it marks their initial performance disclosure following their listing on the ACE Market of Bursa Malaysia Securities Berhad on 5 May 2025.
West River Berhad is a key player in Malaysia’s Mechanical and Electrical (“M&E”) engineering industry, providing electrical engineering and ACMV services, intelligent building solutions, and manufacturing electrical panels. So, how did this newly listed company fare in its first reported quarter? Let’s break it down!
Core Financial Highlights: A First Look
As this is West River Berhad’s first interim financial report following their IPO, there are no comparative figures for the preceding corresponding quarter (Q1 2024). This is a common situation for newly listed entities. However, we can still glean significant insights from the current quarter’s performance and a comparison to the immediate preceding quarter.
For the first quarter ended 31 March 2025, West River Berhad recorded:
- Revenue: RM24.898 million
- Gross Profit: RM3.838 million
- Profit Before Tax (PBT): RM2.303 million
- Profit After Tax (PAT): RM1.524 million
- Basic and Diluted Earnings Per Share (EPS): 0.53 sen
The company’s primary revenue driver was its provision of electrical engineering and ACMV services, which contributed a substantial RM23.09 million, accounting for 92.75% of the total revenue. Intelligent building solutions added RM1.77 million, while the manufacturing of electrical panels and distribution boards contributed RM0.03 million. This breakdown clearly shows the dominance of their M&E services segment.
Quarter-on-Quarter Performance: Navigating the Headwinds
While the initial figures provide a baseline, a more insightful comparison comes from looking at the immediate preceding quarter (Q4 2024). This comparison reveals some of the immediate challenges faced by the company.
Q1 2025
Revenue: RM24.898 million
Gross Profit: RM3.838 million
Profit Before Tax: RM2.303 million
Profit After Tax: RM1.524 million
Q4 2024
Revenue: RM34.454 million
Gross Profit: RM5.293 million
Profit Before Tax: RM4.006 million
Profit After Tax: RM3.217 million
Compared to the immediate preceding quarter (Q4 2024), West River Berhad experienced a notable decline in performance:
- Revenue: Decreased by RM9.56 million, or 27.74%.
- Profit Before Tax: Contracted by RM1.70 million, or 42.51%.
- Profit After Tax: Fell by RM1.69 million, or 52.63%.
The report attributes this decline primarily to a slowdown in project execution during the quarter. This was partly due to the higher number of public holidays, including Chinese New Year and Hari Raya Aidilfitri, which impacted operational days. The lower revenue base, coupled with relatively constant fixed overheads, led to the contraction in profitability. It’s important to note that administrative expenses for this quarter also included non-recurring listing expenses of approximately RM0.68 million, which further impacted the profit before tax and resulted in a higher effective tax rate.
Financial Health: A Stable Foundation
Beyond the income statement, the balance sheet and cash flow statements provide a picture of the company’s financial health.
As at 31 March 2025:
| Financial Metric | As at 31 March 2025 (RM’000) | As at 31 December 2024 (RM’000) |
|---|---|---|
| Total Assets | 77,677 | 78,048 |
| Total Equity | 33,426 | 31,902 |
| Total Liabilities | 44,251 | 46,146 |
| Net Assets Per Share | 0.12 | 0.11 |
The company’s net assets per share saw a slight increase to RM0.12 from RM0.11 at the end of 2024, reflecting an increase in total equity. Importantly, total bank borrowings decreased to RM7.98 million from RM10.57 million at 31 December 2024, indicating a reduction in debt.
From a cash flow perspective, West River Berhad generated RM1.60 million from its operating activities. However, net cash decreased by RM1.11 million for the quarter, primarily due to net cash used in financing activities, which included a net drawdown from bank borrowings and repayment of lease liabilities.
Prospects and Outlook: Building on a Strong Industry
Despite the quarter-on-quarter slowdown, West River Berhad remains optimistic about the future. The M&E engineering industry in Malaysia is supported by sustained investments in infrastructure, commercial developments, and public sector projects. The Malaysian Government’s commitment in Budget 2025, with RM86 billion earmarked for infrastructure and innovation, is expected to provide a steady flow of opportunities. Furthermore, the national economic projection of 4.5% to 5.5% GDP growth offers a stable environment for business expansion.
The Group’s strategic roadmap, as outlined in their Prospectus, includes plans to expand its manufacturing and warehousing capacity and strengthen its business development capabilities. While these initiatives had not commenced implementation by the end of the quarter (as the IPO was completed post-quarter), preparatory steps are underway.
Management is actively addressing external challenges such as cost fluctuations in materials and potential supply chain disruptions through strategies like supplier diversification and bulk procurement to ensure cost-efficiency.
Summary and
West River Berhad’s first quarterly report post-IPO provides a foundational look at its performance. While the quarter-on-quarter figures show a temporary slowdown, largely attributable to seasonal factors and non-recurring listing expenses, the underlying business segments remain robust. The company’s strong position in the M&E engineering sector, coupled with positive government spending and economic growth projections, paints a favorable long-term picture.
Key positive takeaways include:
- Dominance in the M&E services sector, a resilient and in-demand industry.
- Strategic plans for expansion and business development, poised to capitalize on future opportunities.
- Proactive management in mitigating operational risks like cost fluctuations.
- Improved net assets per share and reduced bank borrowings.
The utilization of IPO proceeds, which were raised after the quarter ended, will be a key factor to watch as the company executes its growth strategies. These funds are earmarked for significant initiatives like land acquisition and construction of new facilities, as well as repayment of borrowings and general working capital, which should bolster future performance.
West River Berhad has not proposed or declared any dividends for this quarter.
Final Thoughts: A Quarter of Transition and Preparation
This first quarter for West River Berhad is clearly one of transition and preparation, marked by their successful IPO. While the immediate quarter-on-quarter performance reflects temporary operational slowdowns and IPO-related costs, the company operates in a promising industry with strong government support and has clear strategic growth plans. The effective utilization of the recently raised IPO proceeds will be critical in driving their future growth and achieving their long-term objectives.
What are your thoughts on West River Berhad’s strategy to navigate market challenges and capitalize on Malaysia’s infrastructure growth? Share your views in the comments below!
