Aztech's 1Q25 revenue of S$42m and NPAT of S$12.5m fell sharply by 67% and 91% y-o-y, respectively. We believe the tariffs will reduce US consumer demand and orders from its key customer should remain weak.
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Key customer’s orders remain low.
1Q25 revenue tanked 67% y-o-y as orders from its key customer remained low. The only uplift is likely in 2H25 as the new automated production line at the Malaysia facility remains on track for commissioning in 2Q25 and the 5 new customers from the consumer, health-tech and industrial segments will start commercial production in 2H25.
However, we do not think these orders can replace the lost orders from its key customer and the tariff situation will also be a challenge for its key customer, resulting in demand likely to remain low.
Dividends likely to be lowered as earnings tank.
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Aztech's dividends are unlikely to be sustainable if tariffs remain or worsen.
More downside ahead.
Read more at SGinvestors.io.
Above is an excerpt from a report by Maybank Research. Clients of Maybank Securities may be the first to access the full PDF report @ https://www.maybanktrade.com.sg/.
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