Another quarter has rolled by, and it’s time to dive into the latest financial performance of NICHE CAPITAL EMAS HOLDINGS BERHAD (NICE) as presented in their Interim Financial Report for the Fourth Quarter ended 30 June 2025. This report offers a comprehensive look at the company’s operational shifts and financial health, revealing a mix of strategic adjustments and ongoing challenges. While the full financial year saw a slight improvement in overall losses, the latest quarter faced headwinds, signaling a period of transition for the diversified group.
For Malaysian retail investors keeping a close eye on their portfolios, understanding the nuances behind these numbers is crucial. Let’s break down the key figures and strategic moves that defined NICE’s performance this period.
Snapshot: Full-Year Loss Narrows Slightly, But Q4 Sees Higher Losses.
Despite a significant reduction in full-year revenue, NICE managed to slightly narrow its pre-tax loss for the financial year. However, the fourth quarter experienced an increase in pre-tax losses, highlighting the ongoing efforts to stabilize and grow its core segments amidst a dynamic market.
Core Data Highlights: A Tale of Two Periods
A Look at the Latest Quarter (Q4 FY2025)
The fourth quarter, ending 30 June 2025, presented a mixed picture. Revenue saw a dip, but gross profit surged due to cost management, though overall losses widened.
- Revenue:
Latest Quarter: RM1.45 millionSame period last year: RM1.77 million
A decrease of 18.0%. This revenue was solely driven by the Mining segment’s gold dore sales.
- Gross Profit:
Latest Quarter: RM0.62 millionSame period last year: RM0.19 million
An impressive increase of 226.3%, indicating better cost of sales management in the Mining segment.
- Loss Before Tax:
Latest Quarter: RM(4.32) millionSame period last year: RM(3.07) million
A higher loss of 40.9%. This was primarily impacted by increased losses from the Mining segment (RM3.4 million loss, up from RM2.5 million last year) and the Construction & Services segment (RM0.22 million loss).
- Loss Per Share (Basic):
Latest Quarter: (0.29) senSame period last year: (0.23) sen
Reflecting the higher net loss attributable to shareholders.
Full-Year Performance (FY2025)
For the entire financial year ended 30 June 2025, NICE navigated significant operational shifts, resulting in a substantial revenue contraction but a marginal improvement in its bottom line loss.
- Revenue:
FY2025: RM7.80 millionFY2024: RM22.13 million
A significant decrease of 64.7%. This was mainly due to the Construction & Services segment focusing on inter-company works with no external revenue this year, compared to RM14.5 million in FY2024.
- Gross Profit:
FY2025: RM0.84 millionFY2024: RM1.32 million
A decline of 36.2%, largely in line with the overall revenue reduction.
- Loss Before Tax:
FY2025: RM(11.70) millionFY2024: RM(12.34) million
An improvement of 5.2%. This narrowing of loss, despite lower revenue, is a key highlight, driven by higher profit from the Trading segment and lower losses from the Mining segment.
- Loss Per Share (Basic):
FY2025: (0.80) senFY2024: (0.98) sen
A welcome reduction, reflecting the company’s efforts to control overall losses.
Deep Dive into Business Segments (FY2025)
NICE’s segments showed varied performances, reflecting strategic shifts:
- Trading: Contributed RM5.1 million in revenue and a higher profit of RM0.82 million (compared to RM0.42 million in FY2024) from increased sales of precious metals.
- Construction & Services: No external revenue reported (compared to RM14.5 million in FY2024), as it mainly focused on inter-company construction for the Mining segment. This resulted in a loss of RM0.47 million (compared to a profit of RM1.8 million in FY2024).
- Mining: Revenue of RM2.7 million (down from RM3.5 million in FY2024) but reported a lower loss of RM9.79 million (compared to RM12.16 million in FY2024). This improvement was attributed to the temporary cessation of loss-making alluvial gold mining and the commencement of the heap leaching plant at the end of November 2024. However, higher operating expenditures, including a RM1.4 million charge for mining tributes prepayment, depreciation, and amortisation, partially offset the benefits.
Financial Health Check
The balance sheet and cash flow statements offer further insights into NICE’s financial standing:
Total equity saw a slight increase to RM79.04 million as at 30 June 2025, primarily due to the proceeds from private placements, which bolstered share capital. However, accumulated losses also rose to RM67.46 million.
Net cash used in operating activities significantly increased to RM(13.85) million for FY2025, compared to RM(5.58) million in FY2024. This indicates a higher burn rate from operations, even with a reduction in inventory and receivables.
Navigating the Future: Risks, Strategies, and Outlook
NICE is actively implementing strategies to improve its operational efficiency and long-term prospects. The company’s future hinges on the successful execution of these plans across its key segments:
- Mining Segment: The focus is squarely on increasing gold production. This includes the addition of newly built agitation tanks processing systems to leach fine ores, aiming for higher overall gold output. Exploration programmes for Sokor North are ongoing to identify more mineralisation areas, while other areas like Sokor Midland, Sokor South, and KK Hill are under review. This strategic pivot from alluvial mining to heap leaching and enhanced processing methods could be a game-changer if successful.
- Trading Segment: The company anticipates increased trading activities from its precious metals portfolio. Concurrently, it plans to continuously make opportunistic efforts to sell existing precious stone inventories, aiming to unlock value from current assets.
- Construction & Services Segment: This segment will primarily support the internal construction works for NICE’s infrastructure and mining processing plant. Beyond internal projects, the company is actively exploring new opportunities to build its external order book, which will be vital for its standalone profitability.
The company also underwent significant corporate proposals, including the completion of private placements that raised substantial capital. Further proposals are on the table, including a proposed bonus issue of warrants, a share capital reduction, and another private placement. These moves indicate a proactive approach to capital management and shareholder restructuring, aiming to strengthen its financial base for future growth initiatives.
Potential risks for NICE include the inherent volatility of commodity prices (gold and precious stones), the operational challenges associated with mining expansion and new processing methods, and the ability of the Construction & Services segment to secure external contracts to diversify its revenue streams. The significant cash outflow from operating activities also warrants close monitoring.
Summary and Investment Recommendations
NICHE CAPITAL EMAS HOLDINGS BERHAD’s latest report paints a picture of a company in active transition. While the full financial year showed a promising reduction in overall losses, the immediate quarter faced increased challenges, particularly within the Mining and Construction & Services segments. The strategic focus on enhancing gold production through new processing methods and ongoing exploration in the Mining segment, coupled with efforts to boost the Trading segment and re-energize Construction & Services, are crucial for future performance. The recent and proposed corporate exercises, including private placements, signal a continuous effort to strengthen the company’s financial foundation. Investors should closely monitor the execution of these strategies and their impact on profitability and cash flow in the coming quarters.
Key points for consideration include:
- The successful implementation of new gold production technologies and the outcome of ongoing exploration efforts in the Mining segment.
- The ability of the Construction & Services segment to secure external contracts and move beyond inter-company reliance.
- The impact of the ongoing capital raising and restructuring exercises on the company’s financial stability and shareholder value.
- The company’s ability to manage its operating expenses and improve its cash flow from operations in the upcoming periods.
NICHE CAPITAL EMAS HOLDINGS BERHAD’s journey reflects the dynamic nature of its sectors. What are your thoughts on NICE’s strategic pivot towards enhancing its mining operations? Do you believe the ongoing corporate exercises will pave the way for sustainable growth?
Share your views in the comment section below!
