A-Smart Holdings Ltd – Unaudited Full Year Financial Report for FY2024: Results, Key Insights, and Investor Recommendations

Key Facts from the Report

1. Financial Performance Overview:

   • Revenue: The Group reported revenue of S$7.45 million for FY2024, up 17.6% from S$6.34 million in FY2023.
   • Net Loss: The company incurred a net loss of S$959,000 for FY2024, a significant decline compared to a net profit of S$115,000 in FY2023.
   • Revenue Growth Drivers: Revenue increase was primarily driven by the printing and media segment, which recorded more printing services in 2H2024.
   • Cost Pressures: Raw materials and consumables costs increased by 41.8%, resulting in a lower gross profit margin.

2. Dividend Information:

   • No dividend was declared for FY2024 as the Group suffered a loss for the financial year.

3. Special Activities and Actions for Profitability Improvement:

   • Printing Segment: The company plans to source more suppliers for competitive pricing and invest in new machinery to enhance in-house production, reducing reliance on outsourced partners.
   • Property Development: The Group’s project in Timor-Leste, Timor Marina Square, is under construction. The completion is expected to yield an estimated gross sales value of US$80 million to US$85 million.
   • Smart Technologies: Despite regulatory postponements affecting the market, the Group continues R&D to create environmentally friendly products and strategies to streamline processes.

4. Significant Financial Movements:

   • Assets: Increase in development properties in Timor-Leste due to construction costs for Timor Marina Square.
   • Liabilities: Increase in trade and other payables due to shareholders’ loans for the Group’s subsidiary corporations in Timor-Leste.
   • Cash Flow: The Group recorded a net cash inflow of S$3.88 million mainly due to financing activities, offset by investments in printing equipment and construction costs in Timor-Leste.

5. Share Capital:

   • Rights Issue: Issued 89,437,417 new ordinary shares in 2H2024, resulting in a total issued share capital of 268,312,252 shares as of July 31, 2024.

6. Future Prospects:

   • The Group is focused on accelerating property development progress, strengthening its market share, and investing in environmentally sustainable operations. It is optimistic about the long-term prospects in real estate development in Timor-Leste.

Investor Recommendations

1. For Current Shareholders:

   • Hold: The company is restructuring and actively seeking ways to improve profitability, including enhancing its property development segment and adopting new machinery to optimize costs. Holding the stock might be strategic as these actions could improve future financial performance. However, investors should remain cautious due to current losses and monitor quarterly progress.

2. For Potential Investors:

   • Wait and Observe: The Group is in a transitional phase, investing in new projects like property development in Timor-Leste and machinery for printing. Prospective investors should wait for signs of profitability improvement before entering a position in the stock.

Special Note for Investors

• The company’s revenue is mainly concentrated in the printing and media segment, with other sectors like property development and smart technologies still in their developmental stages. Investors should consider the company’s diversification efforts and market expansion in Timor-Leste.

Disclaimer

The above recommendations are based solely on the information provided in the financial report for FY2024. Investors are encouraged to conduct further research and consider their own risk tolerance before making any investment decisions.