KRONOLOGI ASIA BERHAD: A Look into Their Q1 FY2025 Performance
Greetings, fellow investors and market enthusiasts! Today, we’re diving deep into the latest financial report from KRONOLOGI ASIA BERHAD (KRONOLOGI), a prominent player in the enterprise data management and protection space. Their First Quarter (Q1) results for the financial year ending 30 April 2025 have just been released, and it’s always insightful to peel back the layers and understand what’s driving their performance.
At first glance, KRONOLOGI’s Q1 FY2025 report presents a mixed picture: a commendable increase in core profitability, signaling robust operational performance, yet a notable impact on total comprehensive income due to foreign exchange movements. Let’s break down the numbers to see the full story.
Core Data Highlights: Navigating the Numbers
Revenue and Profitability: Steady Growth in Core Business
KRONOLOGI has demonstrated resilience in its top-line growth and a significant improvement in its pre-tax profit, indicating strong operational efficiency. Here’s how the numbers stack up:
Q1 FY2025 (Ended 30 April 2025)
Revenue: RM 59,248,000
Gross Profit: RM 14,875,000
Profit Before Tax (PBT): RM 1,629,000
Profit for the Period: RM 1,511,000
Basic Earnings Per Share (EPS): 0.20 sen
Total Comprehensive Income: RM (3,730,000)
Q1 FY2024 (Ended 30 April 2024)
Revenue: RM 57,751,000
Gross Profit: RM 14,461,000
Profit Before Tax (PBT): RM 1,146,000
Profit for the Period: RM 1,443,000
Basic Earnings Per Share (EPS): 0.19 sen
Total Comprehensive Income: RM 2,900,000
Looking at these figures, KRONOLOGI’s revenue increased by 2.59% to RM59.25 million compared to RM57.75 million in the same period last year. More impressively, Profit Before Tax (PBT) saw a substantial surge of 42.15%, rising from RM1.15 million to RM1.63 million. This indicates improved operational efficiency and cost management. Net profit for the period also saw a modest increase of 4.71% to RM1.51 million. Consequently, basic earnings per share (EPS) slightly improved to 0.20 sen from 0.19 sen.
However, it’s crucial to note the significant swing in Total Comprehensive Income, which went from a positive RM2.90 million in Q1 FY2024 to a negative RM3.73 million in Q1 FY2025. This was primarily driven by a negative foreign exchange translation from foreign operations, highlighting the impact of currency fluctuations on the company’s overall financial health, particularly given its regional presence.
Financial Position: A Snapshot of Health
Let’s examine KRONOLOGI’s balance sheet, comparing the current quarter’s end with the previous financial year-end to understand changes in its financial structure.
| Item | As At 30 April 2025 (RM’000) | As At 31 January 2025 (RM’000) | Change (RM’000) | Percentage Change (%) |
|---|---|---|---|---|
| Total Assets | 608,886 | 651,557 | (42,671) | -6.55% |
| Total Equity | 453,066 | 456,796 | (3,730) | -0.82% |
| Total Liabilities | 155,820 | 194,761 | (38,941) | -19.99% |
| Net Assets Per Share (RM) | 0.61 | 0.62 | (0.01) | -1.61% |
The company’s total assets decreased by 6.55%, primarily due to a reduction in current assets, specifically trade receivables and cash and bank balances. Total liabilities saw a significant reduction of nearly 20%, which is a positive sign as it indicates the company is managing its obligations effectively. This reduction in liabilities helped mitigate the impact on total equity, which saw a slight dip of 0.82%, largely mirroring the negative total comprehensive income. Net assets per share also saw a marginal decrease from RM0.62 to RM0.61.
Cash Flow: Managing Liquidity
Cash flow is the lifeblood of any business. For Q1 FY2025, KRONOLOGI reported the following:
Q1 FY2025 (Ended 30 April 2025)
Net Cash Generated from Operating Activities: RM 5,253,000
Net Decrease in Cash & Cash Equivalents: RM (24,218,000)
Cash & Cash Equivalents at End of Period: RM 61,585,000
FY2024 (Ended 31 January 2025)
Net Cash Generated from Operating Activities: RM 57,184,000
Net Decrease in Cash & Cash Equivalents: RM 6,418,000
Cash & Cash Equivalents at End of Period: RM 85,799,000
Note: The cash flow statement provided for the current quarter is compared against the preceding financial year-end.
KRONOLOGI generated RM5.25 million from its operating activities in Q1 FY2025. However, there was a net decrease of RM24.22 million in cash and cash equivalents during the quarter, bringing the total cash and cash equivalents to RM61.59 million. This decrease was primarily due to significant net repayments of lease liabilities and interest expenses paid, which outweighed the cash generated from operations and a smaller net cash used in investing activities.
Risk and Prospect Analysis: Looking Ahead
While the core business performance shows positive momentum, a few points warrant attention for KRONOLOGI. The significant negative impact from foreign exchange translation on total comprehensive income highlights the company’s exposure to currency volatility, especially with its regional operations. This is a common challenge for companies with international business, and managing this exposure will be key.
On the positive side, the increase in revenue and profit before tax indicates that KRONOLOGI’s underlying business operations are healthy and expanding. The reduction in total liabilities, particularly lease liabilities, suggests a proactive approach to balance sheet optimization, which can improve financial flexibility. The decrease in trade receivables could also imply more efficient collection processes or a shift towards business models with faster payment cycles.
The data management and protection industry continues to grow, driven by increasing digital transformation, cloud adoption, and the rising importance of data security and compliance. KRONOLOGI, with its established presence, is well-positioned to capitalize on these trends. The company’s ability to maintain revenue growth while improving profitability points to effective strategic execution. Future prospects will depend on their ability to navigate currency fluctuations, continue optimizing their operational costs, and innovate within the evolving data landscape.
Summary and Investment Recommendations
KRONOLOGI ASIA BERHAD’s Q1 FY2025 results paint a picture of operational strength, with healthy increases in revenue and pre-tax profit. This suggests that their core business of enterprise data management and protection is performing well and efficiently. The company also demonstrated strong financial management by significantly reducing its total liabilities.
However, the substantial negative impact from foreign exchange translation on total comprehensive income is a notable point, indicating sensitivity to currency movements. Additionally, the decrease in overall cash and cash equivalents, driven by financing activities, will be something to monitor in future quarters.
Key points to consider moving forward include:
- Foreign Exchange Volatility: The significant negative foreign exchange translation impact on total comprehensive income highlights this as a potential ongoing risk.
- Cash Flow Management: While operating activities generated cash, the overall decrease in cash and cash equivalents, largely due to financing outflows, warrants attention regarding liquidity management.
- Market Dynamics: The company operates in a growing but competitive sector. Continued innovation and strategic partnerships will be crucial for sustained growth.
Overall, KRONOLOGI shows a resilient core business. Investors will likely be keen to see how the company continues to manage its financial health and capitalize on market opportunities in the coming quarters.
As a professional observer of the financial markets, I believe KRONOLOGI’s performance indicates a solid operational foundation. The improvement in pre-tax profit is particularly encouraging, showing that their business model is effective. The foreign exchange impact, while significant, is often a factor that can fluctuate and should be viewed in the context of long-term operational trends. The reduction in liabilities is a strong positive signal of prudent financial management.
What are your thoughts on KRONOLOGI’s latest performance? Do you think the company can maintain this growth momentum and mitigate currency risks in the next few quarters? Share your views in the comments section below!