DUTCH LADY MILK INDUSTRIES BERHAD (3026) Q3 2025 QUARTERLY REPORT

Annoucement Date: 13 Nov 2025

DUTCH LADY MILK INDUSTRIES BERHAD (3026)
Q3 2025	QUARTERLY REPORT FOR THE QUARTER ENDED 30 SEP 2025

https://www.malaysiastock.biz/GetReport.aspx?file=2025/11/13/3026%20-%201725078720408.pdf&name=Bursa%20Q3%202025.pdf

Financial Performance Discussion and Comment for Dutch Lady Milk Industries Berhad (Q3 2025)

The financial performance of Dutch Lady Milk Industries Berhad (DLMI) for the third quarter and nine months ended September 30, 2025, shows a significant recovery in profitability, primarily driven by the successful completion of its transition to the new Bandar Enstek manufacturing facility.

1. Performance Against Preceding Year Corresponding Period (Q3 2025 vs Q3 2024)

Metric	Q3 2025 (RM'000)	Q3 2024 (RM'000)	Change (%)	9M 2025 (RM'000)	9M 2024 (RM'000)	Change (%)
Revenue	374,515	355,452	+5.4%	1,123,518	1,079,097	+4.1%
Operating Profit (Reported)	39,371	21,830	+80.4%	108,083	88,543	+22.1%
Profit After Taxation (PAT)	32,055	17,221	+86.1%	80,483	65,916	+22.1%
Basic EPS (sen)	50.10	26.90	N/A	125.80	103.00	N/A

• Revenue Growth: Quarterly revenue grew by 5.4% to RM374.5 million. This growth was primarily driven by strong sales in the core Dutch Lady liquid milk range, continued momentum in the professional channel, and contributions from newly launched products. The market was also positively boosted by the one-off Sumbangan Asas Rahmah (Sara) assistance for Malaysian citizens.

• Reported Profit Surge: The massive increase in reported operating profit (+80.4%) and PAT (+86.1%) is largely attributable to the cessation of accelerated depreciation expenses following the shutdown of the Petaling Jaya factory in October 2024.

  • Q3 2025 included only RM1.7 million in one-off transition-related costs.

  • Q3 2024 included RM13.2 million in accelerated depreciation and transition-related one-off costs.

• Adjusted Operating Profit: On a like-for-like basis, excluding one-offs and accelerated depreciation, operating profit still increased by 17.1% to RM41.0 million (Q3 2025) compared to RM35.0 million (Q3 2024). This underlying improvement was driven by higher revenue and favorable exchange rate movements.

2. Performance Against Immediate Preceding Quarter (Q3 2025 vs Q2 2025)

Metric	Q3 2025 (RM'000)	Q2 2025 (RM'000)	Change (%)
Revenue	374,515	375,606	-0.3%
Operating Profit (Reported)	39,371	33,940	+16.0%
Profit After Taxation (PAT)	32,055	23,396	+37.0%

• • Sequential Profit Growth: Despite flat revenue (-0.3%) , reported PAT increased significantly by 37.0%.

  • Cost Reduction: This strong sequential profit improvement was mainly due to a further reduction in one-off transition-related costs: from RM5.6 million in Q2 2025 to RM1.7 million in Q3 2025.

  • Underlying Strength: Excluding one-off costs, adjusted operating profit still grew by 3.7% , driven by strong volume performance in liquid milk, lower dairy raw material costs, and favorable currency developments.

  3. Financial Position and Cash Flow

  • Total Equity and Net Assets: Total Equity increased from RM501.9 million (31/12/24) to RM566.4 million (30/09/25). Consequently, the Net Assets per share improved from RM7.84 to RM8.85.

  • Cash Flow from Operations (9M): Net cash generated from operating activities more than doubled, increasing from RM29.7 million (9M 2024) to RM67.5 million (9M 2025).

  • Investing Activities (9M): Net cash used in investing activities decreased from RM102.1 million to RM78.8 million , which funded the continued capital expenditure for the new Distribution Centre in Enstek, which became fully operational in July 2025.

  • Borrowings: The company’s total borrowings remain within limits, utilizing an intercompany loan facility. As of Q3 2025, DLMI had drawn down USD22.1 million (RM92.6 million) from the available USD35 million facility to support capital investments.

  4. Comment on Performance

  The Q3 2025 results mark a crucial turning point for Dutch Lady, moving beyond the heavy investment and high-cost phase of its transition project.

  • Successful Transition Payoff: The most significant comment is that the substantial year-on-year profitability increase is an immediate payoff from the successful closure of the legacy Petaling Jaya factory and the subsequent cessation of accelerated depreciation costs.

  • Strong Underlying Business: Beyond the accounting benefits, the underlying business is robust, demonstrated by the solid revenue growth and the 17.1% increase in adjusted operating profit for the quarter. This indicates effective market strategy and brand strength.

  • Financial Resilience: The company's enhanced operational cash flow and strong balance sheet position it well to navigate future challenges, having successfully self-funded a portion of its major capital investments.

  • Outlook: The outlook is cautiously optimistic. While the company faces ongoing pressure from elevated commodity prices and increased costs from a wider scope of Sales and Services Tax (SST) on services , the operational efficiencies from the new IR4.0 facility and the favorable strengthening of the Malaysian Ringgit are expected to help offset these pressures. The company will continue to focus on optimizing costs and cash flow.

Nestle (Malaysia) Berhad Q3 2025 Quarterly Report

 

Annoucement Date: 28 Oct 2025

NESTLE (MALAYSIA) BERHAD (4707)
Q3 2025	QUARTERLY REPORT FOR THE QUARTER ENDED 30 SEP 2025

https://www.malaysiastock.biz/GetReport.aspx?file=2025/10/28/4707%20-%201322393504828.pdf&name=09KLSEreporting2025%20-%20Final.pdf

Discussion and Commentary

The interim report for Nestlé (Malaysia) Berhad reflects a robust financial performance driven by strong top-line growth and effective operational efficiency.

1. Strong Operational and Sales Momentum

• Revenue Drivers: The 9.4% increase in revenue for the nine months was attributed to growth in both domestic demand and a double-digit expansion in export sales. This highlights the sustained consumer trust in its brands and the successful positioning of the Group as a major Halal manufacturing and innovation hub.

• Profitability Management: Despite potential headwinds, the operating profit and PBT grew at a similar pace to revenue (9.4% and 10.4%, respectively). Management noted this was achieved through topline improvement, disciplined cost management, and operational efficiency.

• Segment Performance: The core Food & Beverages segment, which accounts for 80% of total sales, and the "Others" segment both contributed positively to the growth.

2. Excellent Cash Management and Debt Reduction

• Working Capital Efficiency: The most significant improvement is the massive swing in the Movement in working capital from a negative cash outflow in 2024 to a large cash inflow in 2025. This is crucial, as it shows the Group is efficiently converting sales into cash, leading to a 147.8% increase in Net Cash from Operating Activities.

• Liquidity and Deleveraging: The strong operating cash flow allowed the Group to execute a major deleveraging strategy, resulting in a substantial net repayment of RM280 million in borrowings. This reduced the current loans and borrowings by 64.5% since the beginning of the year, strengthening the balance sheet and reducing financial risk.

3. Increased Shareholder Value

• Dividends: In line with the commitment to shareholder value, the Board declared a higher second interim dividend of 60 sen per share (2024: 35 sen per share). The total proposed/declared dividend for the 9-month period is 130.00 sen per share (2024: 105.00 sen).

• Equity Strength: The significant increase in retained earnings, despite the high dividend payout, confirms the sustainability of the Group's profit generation.

4. Future Outlook and Risk

• Prospects: The Group reconfirms its guidance and remains committed to delivering sustainable value through innovation, operational excellence, and consumer-centric strategies.

• Tax Rate: A point for monitoring is the higher effective tax rate (28.2% for 9M 2025, compared to the 24.0% statutory rate), mainly due to an underprovision for prior year tax expenses.

• Material Litigation: The Group is involved in a material litigation case (Nestlé Products Sdn. Bhd. vs. Mad Labs Sdn. Bhd.) with significant claims and counterclaims. While damages are still being assessed and the company's solicitors are optimistic about their appeal, the outcome remains a financial contingency. The Board currently believes no provision is necessary

Patience and a long-term mindset are crucial during periods of market uncertainty.

Patience and a long-term mindset are crucial during periods of market uncertainty, drawing from core principles of successful investing.

1. Market History Rewards Patience

The single most powerful reason for long-term thinking is the historical performance of the stock market.

• Market Resilience: Despite numerous crises (wars, recessions, pandemics, bubbles), the global stock market has consistently trended upward over long periods. As your investment time horizon lengthens, the probability of achieving a positive return significantly increases.

• Time in the Market > Timing the Market: Trying to buy at the bottom and sell at the top (timing the market) is nearly impossible and often counterproductive. The goal is to maximize time in the market to benefit from compounding growth, which smooths out the inevitable short-term dips.

2. Volatility is Temporary, Losses are Permanent

Market uncertainty leads to high volatility—rapid swings up and down. Panic is the investor’s worst enemy during these times.

• Avoid Locking in Losses: When you panic and sell during a market downturn (a correction or bear market), you convert a temporary paper loss into a permanent, realized loss of capital.

• Missing the Rebound: The market's most significant up-days often occur immediately following its worst down-days. An investor who pulls out due to fear not only locks in losses but also guarantees they will miss the initial stages of the recovery, severely hindering their long-term portfolio growth.

3. Emotion Distorts Decisions

Market uncertainty activates fear and greed, two emotions that are detrimental to rational investment.

• Fear and Panic: Fear pushes investors to sell quality assets at low prices.

• Greed and FOMO (Fear of Missing Out): Greed pushes investors to buy hot, speculative assets at high prices during rallies, or to jump back in after the market has already recovered.

Patience acts as a psychological shield. By sticking to a well-researched strategy and focusing on your 10- or 20-year goals, you tune out the daily noise, resist emotional trading, and allow the intrinsic value of your holdings to eventually be reflected in the price.

Summary: The Long-Term Investor's Advantage

When the market is volatile, the patient, long-term investor is given a strategic advantage:

• Opportunity: Market uncertainty can temporarily push the prices of excellent, fundamentally sound companies below their true worth. Patient investors view these moments not as a crisis, but as a chance to buy quality assets at a discount.

• Discipline: Your focus remains on the company's business fundamentals (earnings, debt, management), not the daily price ticker. If the business is still healthy, you hold on and wait for the market's mood to catch up with reality.

"Do not panic when shares experience short-term movements"

 

The principle of "Do not panic when shares experience short-term movements" is the practical application of discipline and long-term focus. It separates successful, patient investors from those who allow emotion and market noise to dictate their decisions.

Here is an elaboration on why this principle is vital and how short-term volatility relates to long-term returns.

---

1. Volatility is Normal and Inevitable

• Volatility Defined: The day-to-day (or even minute-to-minute) fluctuation in stock prices is called volatility. It is a natural and permanent feature of the stock market.

• The Big Picture: As a long-term investor, your gains come from the fundamental growth of the businesses you own over many years, not the transient mood swings of the market. Historically, despite numerous financial crises, wars, and recessions, the broad stock market (like the S&P 500) has trended upward over multi-year and decade-long periods.

• The Math of Time: Research consistently shows that the probability of achieving a positive return in the stock market dramatically increases the longer you hold your investment. Over very long horizons (e.g., 15 to 20 years), the probability of generating positive returns has historically been extremely high, regardless of when you initially invested.

2. The Dangers of Panic Selling

The primary risk of panicking over short-term movements is locking in permanent losses and missing out on the recovery.

• Selling at the Bottom: Panicked investors sell out of fear when the market is low. They convert a paper loss (a decline in value) into a realized, permanent loss (a loss of capital).

• Missing the Best Days: Studies show that a disproportionately large share of the market’s gains occur during just a few of its best-performing days. These days often occur immediately after sharp downturns. If you sell out of panic, you are highly likely to miss the beginning of the rebound, severely hindering your long-term returns.

• The Wrong Focus: Panicking means you have shifted your focus from the quality of your investment (the company's earnings, business model, and future prospects) to the short-term ticker price, which is often disconnected from the underlying business value.

3. Profiting from Short-Term Volatility

Legendary long-term investors like Warren Buffett view market volatility not as a threat, but as an opportunity created by the panic of others.

• The "Sale" Sign: If your research confirms that a company is high-quality, well-managed, and has intact fundamentals, then a temporary market decline merely puts that stock "on sale."

• Averaging Down: A disciplined, non-panicked investor can use market dips as an opportunity to buy more shares of high-conviction winners at a discounted price, effectively lowering their overall average cost per share. This enhances future returns when the market inevitably recovers.

• Time Horizon as an Advantage: Day traders need volatility to make gains, but for the long-term investor (with a horizon of 10+ years), volatility offers the chance to buy, while the long-term trend of business earnings drives the ultimate gains.

4. How to Apply the Principle

To avoid panic, you must have a clear strategy and confidence:

• Investigate the Cause: When a stock drops, do not panic sell immediately. Instead, pause and ask: Is the drop due to a market-wide event (e.g., interest rate hike, geopolitical news) or a company-specific fundamental breakdown (e.g., failed product, debt crisis)? If it's a market-wide event, the stock is likely a bargain.

• Be Confident in Quality: Your protection against panic is the thorough research you conducted before buying the stock. If your analysis of the company's merit remains strong, you should remain confident and stay invested.

"Do not panic when shares experience short-term movements"

The principle of "Do not panic when shares experience short-term movements" is the practical application of discipline and long-term focus. It separates successful, patient investors from those who allow emotion and market noise to dictate their decisions.

Here is an elaboration on why this principle is vital and how short-term volatility relates to long-term returns.

---

1. Volatility is Normal and Inevitable

• Volatility Defined: The day-to-day (or even minute-to-minute) fluctuation in stock prices is called volatility. It is a natural and permanent feature of the stock market.

• The Big Picture: As a long-term investor, your gains come from the fundamental growth of the businesses you own over many years, not the transient mood swings of the market. Historically, despite numerous financial crises, wars, and recessions, the broad stock market (like the S&P 500) has trended upward over multi-year and decade-long periods.

• The Math of Time: Research consistently shows that the probability of achieving a positive return in the stock market dramatically increases the longer you hold your investment. Over very long horizons (e.g., 15 to 20 years), the probability of generating positive returns has historically been extremely high, regardless of when you initially invested.

2. The Dangers of Panic Selling

The primary risk of panicking over short-term movements is locking in permanent losses and missing out on the recovery.

• Selling at the Bottom: Panicked investors sell out of fear when the market is low. They convert a paper loss (a decline in value) into a realized, permanent loss (a loss of capital).

• Missing the Best Days: Studies show that a disproportionately large share of the market’s gains occur during just a few of its best-performing days. These days often occur immediately after sharp downturns. If you sell out of panic, you are highly likely to miss the beginning of the rebound, severely hindering your long-term returns.

• The Wrong Focus: Panicking means you have shifted your focus from the quality of your investment (the company's earnings, business model, and future prospects) to the short-term ticker price, which is often disconnected from the underlying business value.

3. Profiting from Short-Term Volatility

Legendary long-term investors like Warren Buffett view market volatility not as a threat, but as an opportunity created by the panic of others.

• The "Sale" Sign: If your research confirms that a company is high-quality, well-managed, and has intact fundamentals, then a temporary market decline merely puts that stock "on sale."

• Averaging Down: A disciplined, non-panicked investor can use market dips as an opportunity to buy more shares of high-conviction winners at a discounted price, effectively lowering their overall average cost per share. This enhances future returns when the market inevitably recovers.

• Time Horizon as an Advantage: Day traders need volatility to make gains, but for the long-term investor (with a horizon of 10+ years), volatility offers the chance to buy, while the long-term trend of business earnings drives the ultimate gains.

4. How to Apply the Principle

To avoid panic, you must have a clear strategy and confidence:

• Investigate the Cause: When a stock drops, do not panic sell immediately. Instead, pause and ask: Is the drop due to a market-wide event (e.g., interest rate hike, geopolitical news) or a company-specific fundamental breakdown (e.g., failed product, debt crisis)? If it's a market-wide event, the stock is likely a bargain.

• Be Confident in Quality: Your protection against panic is the thorough research you conducted before buying the stock. If your analysis of the company's merit remains strong, you should remain confident and stay invested.

This video discusses why patience and long-term thinking are crucial during market uncertainty.