ES SUNLOGY BERHAD: A Post-Listing Deep Dive into Q3 FY2025 Performance
Hello fellow investors! Today, we’re taking a closer look at ES SUNLOGY BERHAD, a company that recently made its debut on the ACE Market of Bursa Malaysia on February 20, 2025. As a newly listed entity, its latest unaudited interim financial report for the third quarter ended April 30, 2025, offers our first significant glimpse into its operational health and financial trajectory post-IPO.
While the report reveals a solid cumulative performance since its listing, the immediate quarter-on-quarter figures show some adjustments. This deep dive will unravel the key numbers, explore the drivers behind them, and assess what these results might mean for ES Sunlogy’s future. Stick around as we break down the figures that matter and shed light on this intriguing player in Malaysia’s M&E and renewable energy sectors!
Navigating the Numbers: Q3 FY2025 Performance
It’s crucial to note upfront that as ES Sunlogy Berhad was only listed on February 20, 2025, there are no comparative figures available for the preceding corresponding quarter or financial period-to-date from last year. Our analysis will therefore focus on the performance of the current quarter (Q3 FY2025) against the immediate preceding quarter (Q2 FY2025) and the cumulative period-to-date since listing.
Quarter-on-Quarter Performance (Q3 FY2025 vs. Q2 FY2025)
The current quarter saw a decline in key financial metrics compared to the immediate preceding quarter. Let’s look at the specifics:
Current Quarter (30.04.2025)
Revenue: RM75,611,000
Gross Profit: RM7,000,000
Profit Before Tax (PBT): RM3,423,000
Profit After Tax (PAT): RM2,478,000
Immediate Preceding Quarter (31.01.2025)
Revenue: RM100,023,000
Gross Profit: RM9,410,000
PBT: RM5,494,000
PAT: RM3,876,000
The company’s revenue for the current quarter decreased by RM24.4 million, or 24.4%, to RM75.6 million. This dip was primarily attributed to a lower contribution from the Mechanical & Electrical (M&E) segment, which saw its revenue decline by RM22.9 million to RM67.6 million.
Consequently, gross profit also saw a reduction of RM2.4 million (25.6%), aligning with the lower revenue. Profit Before Tax (PBT) followed suit, decreasing by RM2.1 million (37.7%) to RM3.4 million, reflecting the overall reduced top-line performance.
Cumulative Performance (Period-to-Date Ended 30 April 2025)
Despite the quarter-on-quarter adjustments, the cumulative performance since the company’s listing paints a broader picture of its early journey as a public entity:
Cumulative Revenue: RM239,178,000
Cumulative Profit Before Tax (PBT): RM13,704,000
Cumulative Profit After Tax (PAT): RM10,004,000
Basic Earnings Per Share (EPS): 1.43 sen
These figures represent the total performance over the financial period up to April 30, 2025, providing a baseline for future comparisons.
Segmental Revenue Breakdown (Q3 FY2025)
A closer look at the revenue by segments for the current quarter reveals the primary contributors:
| Segment | Revenue (RM’000) | % of Total Revenue |
|---|---|---|
| M&E Engineering Services | 67,571 | 89.4% |
| Trading (electrical components) | 6,040 | 8.0% |
| Generation and sales of renewable energy | 2,000 | 2.6% |
| Total | 75,611 | 100% |
The M&E engineering services clearly remain the dominant revenue driver for the Group, underscoring its core business strength.
Financial Health: Balance Sheet & Cash Flow Snapshot
As at April 30, 2025, ES Sunlogy’s financial position shows significant growth in assets and equity compared to July 31, 2024, largely due to its recent IPO:
Total Assets: RM239,975,000 (up from RM206,967,000)
Total Equity: RM107,114,000 (a substantial increase from RM57,085,000)
Net Assets per Ordinary Share: RM0.15 (up from RM0.08)
Total Borrowings: RM79,390,000 (a slight decrease from RM81,520,000)
The cash flow statement reveals significant movements. While the Group reported net cash *used in* operating activities of RM29.479 million and net cash *used in* investing activities of RM62.318 million (which included notable acquisitions of a subsidiary for RM50.344 million and a joint venture for RM11.600 million), these outflows were substantially offset by RM84.748 million in net cash *from* financing activities, primarily driven by the IPO proceeds. This resulted in a net decrease in cash and cash equivalents of RM7.049 million for the period.
Future Outlook: Opportunities and Challenges
Bright Prospects Ahead
ES Sunlogy Berhad’s management remains optimistic about the Group’s future, and for good reason. The company has solidified its position in Malaysia’s M&E engineering sector, backed by crucial Class A and G7 contractor accreditations. These credentials empower them to undertake high-value electrical and construction projects nationwide, ensuring a consistent pipeline of work.
A key indicator of future revenue is the Group’s robust unbilled order book, standing at an impressive RM214.1 million as of April 30, 2025. This substantial backlog is expected to be progressively recognized in the financial years ending July 31, 2025, and 2026, providing a strong foundation for sustained revenue growth.
Furthermore, ES Sunlogy has strategically diversified into the renewable energy sector, focusing on solar photovoltaic (PV) solutions since 2017. As a registered PV Service Provider with SEDA Malaysia, the Group operates the Junjong LSSPV Plant and holds a joint venture in the Selarong LSSPV Plant. With the Malaysian government’s strong push for green energy, including initiatives like the Corporate Green Power Programme (CGPP) and an ambitious 40% renewable energy target by 2035, ES Sunlogy is exceptionally well-positioned to capitalize on the growing demand for clean energy solutions.
Navigating Potential Risks
While the outlook is largely positive, it’s essential to acknowledge the ongoing material litigation cases that the Group is involved in. These include:
- Askey Media Technology Sdn. Bhd. vs. Savelite: A claim for liquidated ascertained damages (LAD) and loss of rental income related to project delays. While Savelite had a previous adjudication decision in its favor, the High Court later allowed Askey’s claim for RM768,900.00 plus interest and costs. Savelite has appealed this decision, with the Court of Appeal scheduled to deliver its verdict on July 22, 2025.
- Tenaga Nasional Berhad vs. Askey and Savelite: A claim by TNB for damages to its cables. This case has been settled, with Savelite agreeing to a payment of RM10,000, which was paid on June 11, 2025. This resolution removes one legal overhang.
- Savelite vs. Itramas Technology Sdn. Bhd.: An ongoing dispute related to a solar project, where Savelite initially won an adjudication claim for RM2.577 million, but the High Court later set aside this decision. The Court of Appeal partially allowed Savelite’s appeal, ordering Itramas to pay RM730,899.59 plus interest and costs, which was received in August 2022. However, Savelite is still pursuing an outstanding sum of RM2.154 million in ongoing arbitration proceedings, with hearings scheduled for December 2025.
These legal proceedings, particularly the ongoing arbitration with Itramas and the appeal against Askey’s claim, represent potential financial liabilities or impacts that investors should monitor. However, the Board’s proactive stance in managing these issues and the substantial unbilled order book suggest a resilient operational base to absorb such challenges.
Summary and Outlook
ES Sunlogy Berhad’s third-quarter report for FY2025 provides a foundational look at its performance following its recent listing. While the quarter-on-quarter figures show a dip in revenue and profitability, primarily due to lower contributions from its M&E segment, the cumulative performance since listing highlights a solid start for the Group as a public entity.
The significant increase in total assets and equity, largely bolstered by the IPO proceeds, reflects a strengthened financial position. The strategic investments in a new subsidiary and a joint venture, funded by the IPO, demonstrate the Group’s commitment to expanding its capabilities and market reach, particularly in the promising renewable energy sector. The substantial unbilled order book of RM214.1 million provides a clear runway for future revenue recognition, underpinning the Group’s near-term growth prospects.
Despite the ongoing legal challenges, the Board of Directors remains “optimistic and positive” about the Group’s future. Their established expertise in M&E engineering, coupled with a strategic pivot towards renewable energy, positions ES Sunlogy to potentially benefit from national infrastructure development and the growing demand for sustainable energy solutions in Malaysia.
Key points to monitor:
- The progression and resolution of the ongoing material litigation cases, particularly the Court of Appeal decision for Askey and the arbitration proceedings with Itramas.
- The rate of recognition of the unbilled order book and its impact on future revenue and profitability.
- The successful execution of strategies within the renewable energy segment, especially given government initiatives.
From a professional standpoint, ES Sunlogy Berhad appears to be leveraging its recent listing to fund strategic growth initiatives, particularly in the renewable energy space, which aligns with national priorities. While the quarter-on-quarter revenue dip is worth noting, it appears to be a short-term fluctuation rather than a systemic issue, especially given the strong unbilled order book. The ongoing legal cases are a factor, but the Group seems to be actively managing them.
What are your thoughts on ES Sunlogy’s performance this quarter? Do you believe their diversification into renewable energy will be a significant growth driver in the coming years? Share your insights in the comments below!
