Multi Ways Holdings Announces First Half 2024 Unaudited Financial Results, Provides Corporate Updates

Rhea-AI Summary

Multi Ways Holdings (NYSE: MWG) reported its first half 2024 unaudited financial results, showing a marginal 1.95% decrease in net revenue to $14.09 million compared to H1 2023. Despite revenue challenges, the company's gross profit margin improved to 33.09% from 29.85%. The company achieved a net income of $0.08 million, compared to a net loss of $4.75 million in H1 2023.

Rental revenue increased significantly, representing 25.0% of total revenue in H1 2024 versus 14.7% in H1 2023. The company faced challenges including container supply disruption due to Middle East conflicts and increased competition. Cash and equivalents stood at $3.66 million as of June 30, 2024, down from $7.08 million year-over-year.

Positive

• Gross profit margin improved to 33.09% from 29.85%
• Turned net loss of $4.75M into net income of $0.08M
• Rental revenue share increased to 25.0% from 14.7%

Negative

• Net revenue decreased 1.95% to $14.09M
• Cash and equivalents declined to $3.66M from $7.08M
• Operating cash outflow increased to $8.03M from $7.03M
• Supply chain disruptions affecting container availability
• Increased competition leading to longer machinery delivery times

Insights

Financial Analyst

The H1 2024 results reveal a complex financial picture for Multi Ways Holdings. Despite a marginal 1.95% revenue decline to $14.09 million, the company demonstrated operational resilience with gross profit margin expansion to 33.09%, up from 29.85% year-over-year. The shift in business mix toward rentals, now representing 25% of revenue versus 14.7% in H1 2023, suggests a strategic adaptation to changing market dynamics.

The cash position deterioration to $3.66 million from $7.08 million and increased operating cash outflow to $8.03 million raise concerns about working capital management. However, the reduced investing cash outflow of $0.18 million compared to $3.90 million in the previous period indicates more conservative capital allocation.

The return to profitability with $0.08 million net income, compared to a $4.75 million loss, appears largely attributable to the absence of IPO-related expenses rather than operational improvements. The upcoming infrastructure projects, particularly the Woodlands Checkpoint expansion, could provide future growth catalysts but current financial metrics suggest cautious monitoring is warranted.

Market Research Analyst

The company's performance reflects broader industry trends in Singapore's construction equipment market. The increased rental revenue proportion indicates a structural shift in customer behavior, likely driven by economic uncertainty and capital preservation strategies among construction firms. This transition, while potentially affecting short-term sales, could lead to more predictable recurring revenue streams.

Supply chain disruptions from Middle East tensions have created a challenging operating environment, impacting container availability and machinery delivery times. However, the planned infrastructure developments, particularly the Woodlands Checkpoint expansion project starting in 2025, represent significant market opportunities. The project's scale and multi-year timeline (through 2028) could provide sustained demand for heavy equipment, both through sales and rentals.

NEW YORK, Dec. 31, 2024 (GLOBE NEWSWIRE) -- Multi Ways Holdings Limited (“Multi Ways” or the “Company”) (NYSE American: MWG), a leading supplier of a wide range of heavy construction equipment for sales and rental in Singapore and the surrounding region, today announces first half 2024 unaudited financial results and provides corporate updates.

Mr. James Lim, Chairman and Chief Executive Officer of Multi Ways, commented, “In the first half of 2024, we navigated a challenging landscape marked by constraint on the container supply, intensified competition, and shifting buyer preferences. Despite a marginal decrease in net revenue, it’s noteworthy that our gross profit margin improved to 33.09%, demonstrating our resilient to optimisation on our key revenue stream. We’ve also observed a growing trend of buyers opting for rentals, which account for 25.0% of our revenue. While our net income improved in the first half of 2024 was primarily attributable to the non-recurring of fee in connection with the initial public offering exercise incurred for the six months ended June 30, 2023, we have proactively adapted to these market dynamics to ensure the sustainability of our business for the rest of the year.”

“Looking ahead to 2025, several recent announcements related to major infrastructure projects commencing construction next year leave us optimistic about the future of our business, including expansion works on the Woodlands Checkpoint to five times its size will begin in 2025, and the first phase, comprising an extension at the Old Woodlands Town Centre and Bukit Timah Expressway, is targeted to be completed progressively from 2028.

“We remain dedicated to delivering value to our shareholders, customers, and employees, and are confident in our ability to navigate any challenges and seize the opportunities that lie ahead,” concluded Mr. Lim.

First Half 2024 Financial Highlights

• For the six months ended June 30, 2024, our net revenue marginally decreased 1.95% to $14.09 million, compared to $14.37 million for the six months ended June 30, 2023. The decrease in net revenue was largely due to several factors, including:
  • Disruption on the containers supply due to the middle east war.         
  • Greater competition in the procurement of high-demand machinery due to limited supplies has led to greater lead time for machinery delivery.
  • Buyers being more cautious and opting for rentals – rental revenue as a percentage of total revenue increased to 25.0% in the first half of 2024 versus 14.7% in the first half of 2023.
• Gross profit was approximately $4.66 million, with a 33.09% profit margin, for the first six months of 2024, compared with gross profit of $4.29 million, with a 29.85% profit margin for the first six months of 2023.                 
• Net income was approximately $0.08 million for the first six months of 2024, compared with a net loss of $4.75 million for the first six months of 2023.

Cash Flows Summary

• Cash and cash equivalents were approximately $3.66 million as of June 30, 2024, compared to approximately $7.08 million as of June 30, 2023.                 
• Cash used in operating activities for the six months ended June 30, 2024, was approximately $8.03 million, compared to cash used in operating activities of approximately $7.03 million for the six months ended June 30, 2023.                 
• Cash used in investing activities for the six months ended June 30, 2024, was $0.18 million, a decrease of $3.72 million compared to cash used in investing activities of $3.90 million for the six months ended June 30, 2023, primarily consisting of non-recurring of investment in equity securities and absent of additional right-of-use assets.                 
• Cash provided by financing activities for the six months ended June 30, 2024, was approximately $5.22 million, compared to approximately $14.81 million for the six months ended June 30, 2023. On April 5, 2023, the Company completed its initial public offering, which generated gross proceeds of $15.1 million before deducting any underwriting discounts or expenses.

About Multi Ways Holdings Limited

Multi Ways Holdings supplies a wide range of heavy construction equipment for sales and rental in Singapore and the surrounding region. With more than two decades of experience in the sales and rental of heavy construction equipment business, the Company is widely established as a reliable supplier of new and used heavy construction equipment to customers from Singapore, Australia, UAE, Maldives, Indonesia, and the Philippines. With our wide variety of heavy construction equipment in our inventory and complementary equipment refurbishment and cleaning services, Multi Ways is well-positioned to serve customers as a one-stop shop. For more information, visit www.multiwaysholdings.com. 

Safe Harbor Statement

This press release contains forward-looking statements. In addition, from time to time, we or our representatives may make forward-looking statements orally or in writing. We base these forward-looking statements on our expectations and projections about future events, which we derive from the information currently available to us. Such forward-looking statements relate to future events or our future performance, including: our financial performance and projections; our growth in revenue and earnings; and our business prospects and opportunities. You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as “may,” “should,” “expects,” “anticipates,” “contemplates,” “estimates,” “believes,” “plans,” “projected,” “predicts,” “potential,” or “hopes” or the negative of these or similar terms. In evaluating these forward-looking statements, you should consider various factors, including: our ability to change the direction of the Company; our ability to keep pace with new technology and changing market needs; and the competitive environment of our business. These and other factors may cause our actual results to differ materially from any forward-looking statement. Forward-looking statements are only predictions. The forward-looking events discussed in this press release and other statements made from time to time by us or our representatives, may not occur, and actual events and results may differ materially and are subject to risks, uncertainties, and assumptions about us. We are not obligated to publicly update or revise any forward-looking statement, whether as a result of uncertainties and assumptions, the forward-looking events discussed in this press release and other statements made from time to time by us or our representatives might not occur.

Investor Relations Contact:

Matthew Abenante, IRC
President
Strategic Investor Relations, LLC

Tel: 347-947-2093

Email: matthew@strategic-ir.com 

FAQ

What was Multi Ways Holdings (MWG) revenue performance in H1 2024?

Multi Ways Holdings reported a 1.95% decrease in net revenue to $14.09 million in H1 2024 compared to $14.37 million in H1 2023.

How much did MWG's rental revenue percentage increase in H1 2024?

MWG's rental revenue as a percentage of total revenue increased to 25.0% in H1 2024 from 14.7% in H1 2023.

What was Multi Ways Holdings' (MWG) gross profit margin in H1 2024?

Multi Ways Holdings achieved a gross profit margin of 33.09% in H1 2024, an improvement from 29.85% in H1 2023.

How much cash did MWG have as of June 30, 2024?

Multi Ways Holdings had cash and cash equivalents of approximately $3.66 million as of June 30, 2024.

What were the main challenges faced by MWG in H1 2024?

MWG faced challenges including container supply disruptions due to Middle East conflicts, increased competition in machinery procurement, and shifting buyer preferences toward rentals.