The financial world is a dynamic landscape, and staying informed is key for any investor. Today, we’re diving into the latest quarterly report from RGB International Bhd. for the period ending 31 March 2025. This report offers a crucial glimpse into the company’s performance, revealing a quarter marked by significant shifts in revenue and profitability, alongside strategic maneuvers for future growth. While the headline figures show a decline, a deeper look uncovers nuances and promising prospects.
Let’s break down the key figures and what they mean for the company’s trajectory.
Q1 2025 Financial Snapshot: A Mixed Picture
RGB International Bhd. reported a notable decrease in overall revenue and profit before tax for the first quarter of 2025 when compared to the same period last year. This dip is primarily attributed to lower sales volumes in its core Sales and Marketing division. However, it’s not all about the top line; underlying strengths and strategic adjustments are also visible.
Key Financial Highlights (Q1 2025 vs Q1 2024)
Revenue: RM73,574,000
Compared to RM210,111,000
Change: -65%
Profit Before Tax: RM12,739,000
Compared to RM25,276,000
Change: -50%
Profit for the Financial Period: RM12,139,000
Compared to RM22,005,000
Change: -45%
Basic Earnings Per Share: 0.80 sen
Compared to 1.44 sen
Change: -44%
The significant reduction in revenue was mainly due to a lower number of products sold, impacting the gross profit which also saw a 44% decline to RM22,902,000 from RM40,694,000 in the previous year’s corresponding quarter.
Segmental Performance: A Tale of Two Divisions
A closer look at the business segments reveals varying performances. The Sales and Marketing (SSM) division, traditionally a strong contributor, faced headwinds, while the Technical Support and Management (TSM) division demonstrated resilience in its profitability.
| Segment | Revenue (Q1 2025) | Revenue (Q1 2024) | Revenue Change (%) | PBT (Q1 2025) | PBT (Q1 2024) | PBT Change (%) |
|---|---|---|---|---|---|---|
| Sales and Marketing | RM50,527,000 | RM174,885,000 | -71% | RM6,862,000 | RM22,676,000 | -70% |
| Technical Support and Management | RM22,594,000 | RM33,412,000 | -32% | RM7,181,000 | RM5,219,000 | +38% |
| Engineering Services | RM363,000 | RM588,000 | -38% | RM209,000 | RM423,000 | -51% |
| Others | RM90,000 | RM1,226,000 | -93% | (RM785,000) | (RM726,000) | +8% |
The SSM division’s revenue and profit before tax saw significant drops of 71% and 70% respectively, primarily due to lower product sales. In contrast, while the TSM division’s revenue decreased by 32% (due to lower performance in some outlets), its profit before tax remarkably increased by 38%. This impressive profit growth in TSM is mainly attributed to lower depreciation costs for machines during the quarter.
Additionally, unallocated expenses decreased, largely due to an increase in unrealised foreign exchange gains, which provided a positive offset to the overall financial performance.
Financial Health and Cash Flow
Looking at the balance sheet, total assets saw a slight decrease from RM679,513,000 as at 31 December 2024 to RM654,521,000 as at 31 March 2025. Similarly, total equity declined from RM294,930,000 to RM290,100,000. This reflects the quarter’s lower profitability and the declaration of dividends.
On the cash flow front, the company experienced a shift from net cash generation to net cash usage in operating activities, moving from RM24,458,000 generated in the previous year’s corresponding quarter to a net cash *used* of RM11,261,000 in Q1 2025. However, investing activities saw a positive swing, generating RM4,447,000 compared to a net use of RM10,565,000 previously, primarily due to net changes in other investments.
Future Prospects and Strategic Outlook
Despite the challenging first quarter, RGB International Bhd. maintains a positive outlook for the remainder of 2025. The company is strategically positioned to capitalize on promising market conditions, particularly in the Philippines and Cambodia.
The Philippine Amusement and Gaming Corporation (PAGCOR) has set an ambitious target of PHP 450 billion for the country’s Gross Gaming Revenue (GGR) in 2025, signalling robust industry growth. As a key slot machine distributor and a major player in the machine concession business in the region, RGB International Bhd. is well-placed to benefit from this expansion. The Group is also actively expanding its footprint in Cambodia.
In a move to diversify and strengthen its capabilities, the company incorporated a wholly-owned subsidiary, RGB Digital Ltd (RGBDL), in Thailand on 31 January 2025. This new entity will focus on trading, designing, developing, and supporting digital hardware and software, indicating a forward-looking strategy into new technological areas within its domain.
The company also stated its vigilance for emerging opportunities, including new and upcoming markets, and expects to achieve a satisfactory performance for the full year 2025, barring unforeseen circumstances.
Dividends: Returning Value to Shareholders
In a positive sign for shareholders, RGB International Bhd. has declared and paid dividends. The Fourth Interim Single Tier Dividend of RM0.006 per ordinary share and Second Special Interim Single Tier Dividend of RM0.004 per ordinary share for the financial year ended 31 December 2024 were paid on 18 April 2025. Furthermore, the Board of Directors has approved a First Interim Single Tier Dividend of RM0.004 per ordinary share for the financial year ending 31 December 2025, with an entitlement date of 30 June 2025 and payment on 18 July 2025.
Summary and
RGB International Bhd.’s Q1 2025 results present a mixed bag. While the overall revenue and profit saw a significant contraction, largely due to reduced product sales in the Sales and Marketing division, the Technical Support and Management segment demonstrated impressive profit growth. The company’s strategic focus on high-growth markets like the Philippines and Cambodia, coupled with its expansion into digital hardware and software through its new Thai subsidiary, paints a picture of a company actively adapting and pursuing future opportunities. The consistent dividend declarations also underscore a commitment to shareholder returns.
Looking ahead, the company’s performance will likely hinge on the successful execution of its expansion plans in the gaming sector and the ability to navigate market dynamics that impacted its core sales business this quarter. The positive outlook for the gaming industry in the region provides a strong tailwind, but vigilance will be key.
Key points to consider for future performance include:
- Dependence on the Sales and Marketing division’s recovery in product sales.
- Volatility in foreign exchange rates, which significantly impacted unallocated expenses this quarter.
- The success of strategic expansion initiatives in the Philippines and Cambodia.
- Execution of new ventures, such as the digital hardware and software business in Thailand.
- Overall economic conditions and regulatory changes in the gaming industry across its operating regions.
It’s clear that while the recent quarter presented challenges, RGB International Bhd. is actively positioning itself for future growth and remains optimistic about its prospects for 2025. The company’s strategic expansions and the resilience shown in its TSM division offer a compelling narrative for its ongoing development.
What are your thoughts on RGB International Bhd.’s Q1 2025 performance? Do you believe their strategic focus on the Philippines and Cambodia will drive significant growth in the coming quarters? Share your insights in the comments below!
For more detailed analysis on companies in the Malaysian market, consider exploring our other financial blog posts.
