NEXTGREEN GLOBAL BERHAD: A Green Leap Forward in Q1 2025 Earnings!
Hello fellow retail investors! Today, we’re diving deep into the latest financial report from NEXTGREEN GLOBAL BERHAD (NGGB), a company making significant strides in Malaysia’s green technology and sustainable manufacturing sectors. Their unaudited condensed consolidated interim financial report for the quarter ended 31 March 2025 has just landed, and it reveals a truly impressive performance, particularly in their core manufacturing operations.
The headline? NGGB has more than doubled its profit after tax attributable to owners of the Company (PATAMI) compared to the same period last year! This significant jump signals strong operational efficiency and a clear path forward. Let’s unpack the numbers and see what’s driving this green growth story.
Q1 2025 Performance Highlights: A Closer Look at the Numbers
NEXTGREEN GLOBAL BERHAD’s first quarter of 2025 (Q1 2025) showcased robust growth, largely fueled by its manufacturing division. Here’s a snapshot of their key financial figures, comparing Q1 2025 with Q1 2024:
Q1 2025
Operating Revenue: RM14.08 million
Gross Profit: RM8.52 million
Other Income: RM3.33 million
Profit from Operations: RM8.37 million
Profit Before Tax (PBT): RM7.14 million
Net Profit Attributable to Owners: RM7.14 million
Basic Earnings Per Share (EPS): 0.67 sen
Q1 2024
Operating Revenue: RM13.32 million
Gross Profit: RM5.77 million
Other Income: RM1.46 million
Profit from Operations: RM4.20 million
Profit Before Tax (PBT): RM3.02 million
Net Profit Attributable to Owners: RM3.03 million
Basic Earnings Per Share (EPS): 0.31 sen
As you can see, the numbers speak volumes:
- Revenue Growth: Operating revenue saw a healthy 9% increase year-on-year, reaching RM14.08 million. This was primarily driven by strong contributions from the liquid fertiliser segment and a significant 60% surge in pulp and paper product sales.
- Soaring Gross Profit: Gross profit jumped by an impressive 54% to RM8.52 million. This was largely due to a 26% reduction in the cost of sales, reflecting enhanced operational efficiencies and better production cost control, especially in liquid fertiliser manufacturing.
- Boost from Other Income: Other income more than doubled to RM3.33 million, boosted by higher black liquor sales (a by-product from pulp and paper operations) and minor gains from equipment disposal.
- Profitability Surge: Profit before tax (PBT) more than doubled, hitting RM7.14 million, while the net profit attributable to owners saw a similar increase to RM7.14 million. This translated into a basic EPS of 0.67 sen, a significant leap from 0.31 sen in Q1 2024.
The Group also managed its operating expenses tightly, with selling, distribution, and promotional costs declining by 60%. While administrative expenses rose due to corporate exercise-related professional fees, the overall picture points to robust financial management.
Quarter-on-Quarter Comparison: Q1 2025 vs Q4 2024
Comparing the current quarter to the immediate preceding quarter (Q4 2024) also reveals a positive trajectory:
Q1 2025
Operating Revenue: RM14.08 million
Gross Profit Margin: 60%
Other Operating Income: RM3.33 million
Operating Expense: RM3.47 million
Profit Before Tax (PBT): RM7.14 million
Q4 2024
Operating Revenue: RM16.77 million
Gross Profit Margin: 53%
Other Operating Income: RM1.15 million
Operating Expense: RM6.32 million
Profit Before Tax (PBT): RM1.29 million
Despite a slight dip in operating revenue, Q1 2025 saw a substantial improvement in PBT compared to Q4 2024. This was primarily due to:
- Improved Gross Profit Margin: Rising from 53% to 60%, reflecting better cost control and product mix.
- Higher Other Operating Income: More than doubling due to black liquor sales.
- Lower Operating Expenses: A significant 45% reduction, attributed to the absence of one-off year-end charges and tighter cost control.
- Absence of Associate Losses: Q1 2025 did not incur the share of loss from an associate that impacted Q4 2024.
Segmental Performance: A Mixed Bag with Strong Core
Let’s break down the performance by business segment:
Manufacturing Division: The Growth Engine
This division continues to be NGGB’s powerhouse. Operating revenue increased by 7% to RM12.63 million, driven by pulp and paper and liquid fertiliser sales. Gross profit surged by 53% to RM7.50 million, with the gross profit margin significantly improving from 41% to 59%. This remarkable efficiency is largely thanks to the integrated use of black liquor by-products in fertiliser manufacturing, a testament to their circular economy approach. Profit after tax for this division rose by 48% to RM9.11 million.
Property & Construction Division: Emerging Contributions
The Property & Construction division recorded RM0.87 million in operating revenue in Q1 2025 (compared to nil in Q1 2024). This revenue came from project management fees for a tissue paper plant within the Green Technology Park (GTP), marking the start of revenue recognition from external contracts. The division turned a loss of RM0.53 million in Q1 2024 into a profit of RM0.15 million this quarter, despite increased operating expenses related to future GTP development phases.
Printing & Publishing Division: Strategic Rationalization
This division continues its restructuring journey, with revenue declining by 54% to RM0.58 million. This is part of the Group’s strategy to phase out external print jobs and close unprofitable service lines. While still recording a gross loss (RM0.22 million), it’s an improvement from the RM0.74 million loss in Q1 2024. The net loss after tax reduced to RM0.47 million, reflecting cost rationalization efforts despite fixed cost pressures.
Utility & Renewable Energy Division: Future Potential
Currently dormant in terms of revenue and gross profit, this division incurred minimal operating expenses (RM25,000) for statutory compliance and early-stage consultancy related to upcoming biomass initiatives. Preparatory work for the Group’s first palm oil biomass processing center is underway, with operations expected to commence in the medium term.
Other Division: Corporate Overhead
This segment, comprising the parent company and non-classified subsidiaries, recorded no operating revenue in Q1 2025. Its Q1 2024 performance included a one-off gain from subsidiary disposal, which was absent this quarter. Despite a significant 66% reduction in operating expenses due to lower professional fees and reduced corporate activity, the division recorded a slightly higher net loss of RM1.63 million due to the absence of non-recurring income and continued absorption of Group-level administrative and financing expenses.
Future Outlook and Strategic Initiatives
NEXTGREEN GLOBAL BERHAD is clearly focused on long-term value creation through its Green Technology Park (GTP) in Pekan, Pahang, and strengthening its core manufacturing operations. Here are some key initiatives:
Pulp Production Facility Joint Venture: A major highlight is the Joint Venture Agreement (JVA) signed in April 2025 for a new company, Neuwhite Paper Pulp Sdn Bhd (NWPP). NWPP will develop and operate a bleached chemical empty fruit bunch (EFB) pulp mill with an annual capacity of 150,000 metric tons under Phase 2A of the GTP. This is a significant step towards expanding their sustainable pulp production.
In the Fertilizer segment, Nextgreen Fertilizer Sdn Bhd (NGF) is constructing a solid fertilizer manufacturing facility (30,000 MT/year) and an automated liquid fertilizer facility (30,000 MT/year), both targeted for completion and commercial production by Q3 2025. The liquid fertilizer production utilizes black liquor, showcasing their commitment to a circular economy. Furthermore, NGF has secured a distribution agreement to supply up to 25,000 metric tons annually to the Libyan fertilizer market.
The Animal Feed segment is also progressing, with preliminary works for a facility with a projected annual capacity of 10,000 metric tons targeted for completion in Q4 2025.
Beyond these, NGGB is developing a nationwide network of 20 Collection and Processing Centers (CPCs) for oil palm biomass waste, with the first within GTP and others identified in Gua Musang and Sandakan. They are also undertaking a strategic land optimization study within the GTP for future joint venture developments.
While legacy printing operations continue to serve niche internal and external needs, the Group’s strategic focus has clearly shifted towards higher-margin, sustainable sectors like green manufacturing, zero-waste innovation, and the circular economy, all anchored within the GTP.
Summary and Future Outlook
NEXTGREEN GLOBAL BERHAD’s Q1 2025 results demonstrate a strong start to the financial year, driven by exceptional performance in its manufacturing division and strategic efforts to optimize costs and expand its green technology footprint. The significant increase in profitability underscores the effectiveness of their focus on sustainable manufacturing and the utilization of by-products.
The Group’s future prospects appear positive, supported by ongoing commercialisation of new facilities, the execution of strategic partnerships, and a broader alignment with Malaysia’s shift towards sustainable development. The development of the EFB pulp mill, new fertilizer plants, and biomass processing centers are key initiatives that are expected to strengthen NGGB’s position as a vital player in the green technology and circular economy ecosystem.
It is important to note that this blog post provides an analysis of the company’s financial report and does not constitute any form of investment advice or recommendation to buy or sell shares. Investors should conduct their own due diligence and consult with financial professionals before making any investment decisions.
Key points for the future include:
- Successful execution and commissioning of the new EFB pulp mill joint venture.
- Timely completion and commercialization of the solid and liquid fertilizer facilities.
- Expansion of the biomass Collection and Processing Centers network.
- Continued cost management and operational efficiency across all segments.
What are your thoughts on NEXTGREEN GLOBAL BERHAD’s Q1 2025 performance and their ambitious green technology plans? Do you think they can maintain this growth momentum in the coming quarters, especially with the new facilities coming online?
Share your views in the comment section below! We’d love to hear from you.
For more in-depth analyses of Malaysian companies, keep an eye on our blog for upcoming articles.
