AJINOMOTO (MALAYSIA) BERHAD: A Mixed Plate of Performance in Q4 FY2025
AJINOMOTO (MALAYSIA) BERHAD, a household name in Malaysia known for its wide range of consumer and industrial products, has just released its latest quarterly report for the period ended 31 March 2025. This report offers a comprehensive look into the company’s financial health and strategic direction. While the full financial year demonstrated commendable growth, the fourth quarter presented a more nuanced picture, largely influenced by the absence of a significant one-off gain recorded in the previous year.
A key highlight from the report is the company’s full-year profit growth and the announcement of a substantial special dividend, reflecting a commitment to shareholder returns. However, the quarter also faced market challenges, leading to a temporary dip in some key metrics. Let’s dive into the details to understand the ingredients of their performance.
Core Data Highlights: Unpacking the Numbers
Quarterly Performance Snapshot (3 months ended 31 March)
The fourth quarter of the financial year 2025 showed a dip in some key financial indicators when compared to the same period last year. It’s crucial to understand the underlying reasons for these changes, particularly the impact of a significant one-off event in the prior year.
Revenue
Current Quarter: RM149.8 million
Last Year’s Corresponding Quarter: RM152.8 million
(Slight decrease of approximately 1.9%)
Operating (Loss)/Profit
Current Quarter: (RM0.5 million loss)
Last Year’s Corresponding Quarter: RM12.1 million profit
(Significant decrease due to increased selling and administrative expenses, notably advertising and sales promotion.)
Profit Before Tax
Current Quarter: RM1.3 million
Last Year’s Corresponding Quarter: RM403.5 million
(The substantial difference is primarily due to a one-off gain on disposal of assets held for sale of RM391.4 million recorded in the corresponding quarter last year. Excluding this extraordinary item, the underlying performance provides a clearer view.)
Net (Loss)/Profit for the Period
Current Quarter: (RM6.9 million loss)
Last Year’s Corresponding Quarter: RM364.2 million profit
(Reflects the impact of the lower operating profit and the absence of the one-off gain, along with higher tax expenses.)
Basic (Loss)/Earnings Per Share
Current Quarter: (11.35 sen loss)
Last Year’s Corresponding Quarter: 599.04 sen earnings
(Directly follows the net profit trend.)
Full-Year Resilience (12 months ended 31 March)
Despite the challenging fourth quarter, AJINOMOTO (MALAYSIA) BERHAD demonstrated resilience over the full financial year, showing growth in core operational areas:
Revenue
Current Year To-Date: RM684.5 million
Preceding Year To-Date: RM636.4 million
(A healthy increase of approximately 7.6%, indicating strong sales momentum over the year.)
Operating Profit
Current Year To-Date: RM67.1 million
Preceding Year To-Date: RM60.2 million
(An increase of approximately 11.4%, showcasing improved operational efficiency over the longer term.)
Net Profit for the Period
Current Year To-Date: RM49.7 million
Preceding Year To-Date: RM401.4 million
(Similar to the quarterly figures, the substantial difference here is due to the one-off gain on asset disposal in the prior year’s cumulative results.)
Segmental Performance: A Closer Look
The company’s performance is driven by two key business segments: Consumer Business and Industrial Business. Here’s how they fared in the current quarter compared to the same period last year:
| Segment | Revenue (3M Mar 2025) | Revenue (3M Mar 2024) | Operating (Loss)/Profit (3M Mar 2025) | Operating Profit (3M Mar 2024) |
|---|---|---|---|---|
| Consumer Business | RM116.9 million | RM116.1 million | (RM2.8 million loss) | RM8.1 million profit |
| Industrial Business | RM32.9 million | RM36.6 million | RM2.3 million profit | RM4.0 million profit |
| Total | RM149.8 million | RM152.8 million | (RM0.5 million loss) | RM12.1 million profit |
While the Consumer Business segment saw a slight increase in revenue due to higher sales volume, it recorded an operating loss for the quarter, primarily impacted by increased selling and administrative expenses. The Industrial Business segment experienced lower revenue and profit, attributed to reduced sales volume and selling prices of industrial seasoning products.
Financial Health and Cash Flow
AJINOMOTO (MALAYSIA) BERHAD’s balance sheet as of 31 March 2025 shows a strong financial position, notably with zero borrowings after fully settling its Islamic financing in the first quarter of the current financial year. This is a significant positive indicator of financial prudence.
Cash flow from operating activities for the full year improved to RM68.7 million from RM63.6 million in the previous year. Net cash used in financing activities saw a substantial increase, primarily due to the payment of a significant special dividend. This indicates a strong return of capital to shareholders, albeit impacting the overall cash balance for the period.
Risks and Prospects: Navigating the Future
The company acknowledges the prevailing global trade and geopolitical tensions, which could lead to fluctuating raw material and logistic costs. These external factors pose potential headwinds for the business. In response, AJINOMOTO (MALAYSIA) BERHAD is focusing on strengthening its competitive position to safeguard its market share and profitability. This strategic emphasis on internal efficiencies and market resilience will be crucial in navigating an unpredictable global economic landscape.
Dividends: Rewarding Shareholders
The company’s commitment to shareholders was evident through its dividend payouts. A special one-off single-tier dividend of RM2.12 per ordinary share, amounting to RM128.9 million, was declared and paid for the financial year ended 31 March 2025. Additionally, a first and final single-tier dividend of 38.4 sen per ordinary share for the financial year ended 31 March 2024 was paid earlier. The Board of Directors did not recommend any further dividend for the current quarter, following these significant payouts.
Summary and
AJINOMOTO (MALAYSIA) BERHAD’s latest report paints a picture of a company with underlying operational strength, evidenced by its full-year revenue and operating profit growth. While the fourth quarter’s profit figures appear significantly lower, this is largely an accounting effect due to a one-off asset disposal gain in the prior year’s comparable quarter. Excluding this, the company faces operational challenges in the short term, particularly from rising expenses and segment-specific headwinds.
The company’s strong financial health, marked by zero borrowings and a significant special dividend payment, underscores its robust balance sheet and commitment to shareholder value. Looking ahead, the focus on strengthening its competitive position is a prudent strategy to counter external market volatilities.
Key points to consider from this report include:
- Full-year revenue and operating profit showed positive growth, indicating core business strength.
- The quarterly profit decline is largely attributable to the absence of a one-off asset disposal gain from the previous year.
- Increased selling and administrative expenses impacted the latest quarter’s operating profit, particularly in the Consumer Business segment.
- The company has successfully settled all its borrowings, showcasing a strong financial position.
- A substantial special dividend was paid, returning significant capital to shareholders.
- Future prospects are tempered by global trade and geopolitical tensions, potentially leading to fluctuating raw material and logistic costs.
It is important to note that this analysis provides an overview of the company’s financial performance based on the latest report, and does not constitute any form of buy or sell recommendations or investment advice.
In conclusion, AJINOMOTO (MALAYSIA) BERHAD appears to be navigating a complex economic environment with strategic foresight. While the recent quarter presented some operational challenges, the full-year performance and strong financial management provide a solid foundation. The company’s efforts to strengthen its market position amidst global uncertainties will be key to its continued success.
What are your thoughts on AJINOMOTO (MALAYSIA) BERHAD’s performance? Do you believe the company can effectively manage the rising costs and maintain its growth momentum in the coming years? Share your insights in the comments section below!
