Magna Prima Berhad Q1 2025: A Deep Dive into the Latest Financials
Hello fellow retail investors! Today, we’re dissecting the latest interim financial statements from Magna Prima Berhad for the quarter ended 31 March 2025. This report offers crucial insights into the company’s performance, strategic direction, and the challenges it faces. While the quarter saw a shift to a loss, it’s important to understand the underlying factors and the company’s ongoing property development initiatives.
Key Takeaway: Magna Prima Berhad recorded revenue primarily from its property development activities in Q1 2025, a significant change from the prior year’s corresponding quarter. However, the period concluded with a pre-tax loss, largely attributed to operating expenses and translation losses from the deregistration of its Australian subsidiary.
Unpacking the Numbers: Financial Performance Overview
Let’s break down the core financial figures for the quarter, comparing them against the same period last year (Q1 2024) and the immediate preceding quarter (Q4 2024) to get a clearer picture of the trends.
Quarter-on-Quarter (QoQ) Performance (vs. Q4 2024)
Comparing the current quarter with the immediate preceding quarter provides context on recent operational shifts:
Q1 2025
Revenue: RM5.091 million
Gross Profit: RM0.463 million
Loss Before Tax: (RM2.331 million)
Loss for the Period: (RM3.228 million)
Q4 2024
Revenue: RM158.308 million
Gross Profit: RM21.156 million
Loss Before Tax: (RM2.992 million)
Profit for the Period: RM4.227 million
Magna Prima’s revenue for Q1 2025 saw a substantial decline of 97% from RM158.308 million in Q4 2024 to RM5.091 million. This significant reduction is primarily due to lower progress recognition across various ongoing property development projects. Despite the sharp revenue drop, the company managed to reduce its pre-tax loss by 22%, from RM2.992 million in Q4 2024 to RM2.331 million in Q1 2025. This improvement in loss reduction was driven by higher interest revenue generated during the quarter.
Year-on-Year (YoY) Performance (vs. Q1 2024)
Here’s how Q1 2025 stacks up against the same period last year:
Q1 2025
Revenue: RM5.091 million
Gross Profit: RM0.463 million
(Loss)/Profit Before Tax: (RM2.331 million)
(Loss)/Profit for the Period: (RM3.228 million)
Basic Earnings Per Share: (0.81 sen)
Q1 2024
Revenue: RM0 million
Gross Profit: RM0 million
(Loss)/Profit Before Tax: RM16.072 million (Profit)
(Loss)/Profit for the Period: RM16.059 million (Profit)
Basic Earnings Per Share: 4.02 sen
Notably, Q1 2025 saw Magna Prima record revenue of RM5.091 million, a significant improvement from zero revenue in Q1 2024. This revenue was primarily driven by the commencement and ongoing recognition from the Kepong Phase 2D Apartment project. However, the company swung from a pre-tax profit of RM16.072 million in Q1 2024 to a pre-tax loss of RM2.331 million in Q1 2025. This shift was largely due to increased operating expenses and a one-off translation loss recognized from the deregistration of Magna Prima Australia Pty Ltd on 24 March 2025.
Snapshot of Financial Health (Balance Sheet & Cash Flow)
Let’s glance at the company’s financial position:
| Financial Metric | As at 31 March 2025 (RM’000) | As at 31 December 2024 (RM’000) | Change (RM’000) |
|---|---|---|---|
| Total Assets | 365,468 | 369,324 | (3,856) |
| Inventories | 201,559 | 203,114 | (1,555) |
| Cash & Bank Balances | 1,184 | 6,934 | (5,750) |
| Fixed & Short-Term Deposits | 3,987 | – | 3,987 |
| Trade & Other Payables | 51,139 | 36,464 | 14,675 |
| Current Tax Liabilities | 113 | 18,450 | (18,337) |
| Net Assets Per Share (RM) | 0.79 | 0.79 | 0.00 |
The balance sheet shows a slight decrease in total assets. A notable change is the significant increase in fixed and short-term deposits, while cash and bank balances decreased. This suggests a reallocation of liquid assets. Trade and other payables saw a substantial increase, while current tax liabilities decreased significantly. Net assets per share remained stable at RM0.79.
From a cash flow perspective, the Group recorded a net cash outflow from operating activities of (RM1.154 million) for Q1 2025, a stark contrast to the net cash inflow of RM46.458 million in the corresponding period last year. This shift indicates challenges in generating cash from core operations during the quarter, mainly due to a large tax payment of RM19.640 million during the period.
Strategic Focus & Future Prospects
Despite the challenging quarter, Magna Prima is actively managing and exploring new opportunities within the property sector. The company’s strategic focus remains on its key development projects:
- Jalan Ampang Land Development: A flagship project in collaboration with Armani Hallson Sdn Bhd, guaranteeing a minimum fixed entitlement of RM350 million.
- Kepong Phase 2D Apartment: A joint venture with Dewan Bandaraya Kuala Lumpur (DBKL) for 306 serviced apartment units, which contributed to the current quarter’s revenue.
- Shah Alam KGSSAS Project: Consisting of 315 condominium units overlooking a golf course, developed in partnership with Golden Armani Sdn Bhd.
- Shah Alam Lot PT12 Project: A mixed-use development with OCR Avenue Sdn Bhd, where Magna Ecocity is entitled to a minimum of RM160 million.
The Group is also actively reviewing several proposals for joint land development opportunities within Peninsular Malaysia, signaling its commitment to portfolio expansion and future growth.
Navigating Challenges: Risks and Outlook
As with any business, Magna Prima faces certain risks that investors should be aware of. The report highlights several ongoing material litigations:
- A RM1.6 million claim by GT Nelson Realty Sdn. Bhd. against Everhall (M) Sdn. Bhd. and Magna Prima Berhad, set for trial in July 2025.
- A RM1.0 million claim by Hua Yang Berhad against Magna Prima Berhad and Magna City Shah Alam Sdn. Bhd., with an out-of-court settlement being explored.
- A RM1.3 million claim by JMB Vista Magna Apartment against Magna Park Sdn. Bhd., currently pending appointment of a replacement judge for a consent judgment.
- An ongoing legal dispute with Tenaga Nasional Berhad (TNB) for unpaid electricity bills. While the Sinar Magna case was settled post-period, the Vista Magna trial has concluded with a decision scheduled for May 29, 2025.
The company’s ability to manage these legal challenges will be crucial. Furthermore, the significant drop in revenue recognition QoQ indicates the inherent lumpy nature of property development projects and the importance of project execution and sales pace.
Summary and
Magna Prima Berhad’s Q1 2025 results reflect a period of transition, marked by the commencement of revenue recognition from ongoing property development projects, particularly Kepong Phase 2D, a positive sign after a quarter with no revenue in the prior year. However, the quarter also saw the company record a net loss, primarily due to operational expenses and a one-off translation loss from the deregistration of its Australian subsidiary. The shift to a negative cash flow from operations also warrants attention, partly due to a significant tax payment.
Looking ahead, the company’s prospects are tied to the successful execution and sales progress of its four major development projects. The active exploration of new land development opportunities signals a proactive approach to future growth. Investors should monitor the progress of these projects and the resolution of the ongoing litigations, as they will undoubtedly impact the company’s financial trajectory.
- Project Execution: The timely completion and successful sales of key development projects like Jalan Ampang and Kepong Phase 2D will be vital for future revenue and profit generation.
- Legal Resolution: The ongoing material litigations, particularly the outcomes of the GT Nelson Realty and JMB Vista Magna cases, could have financial implications.
- Cash Flow Management: The shift to negative cash flow from operations in Q1 2025 highlights the importance of prudent cash management, especially with ongoing project development needs.
It’s important to remember that property development is a cyclical business, and quarterly results can fluctuate significantly based on project recognition stages. The company’s long-term strategy and ability to convert its landbank into profitable developments will be key determinants of its future success.
What are your thoughts on Magna Prima Berhad’s latest performance and its strategic direction? Do you think the company can effectively navigate these market dynamics and legal challenges while capitalizing on its new development opportunities in the coming quarters? Share your views in the comments section below!
Stay tuned for more in-depth analyses of Malaysian companies.
