Asia Pacific Wire & Cable(APWC) - 2025 Q2 - Quarterly Report

Executive Summary & Highlights Q2 2025 Financial Highlights APWC reported strong financial results for Q2 2025, with significant increases in revenue and earnings per share (EPS) both quarter-over-quarter and year-over-year. Copper unit volume also saw a sequential increase Q2 FY2025 Key Financial Highlights: | Metric | Q2 FY2025 | Q1 FY2025 | Q2 FY2024 | Q/Q Change | Y/Y Change | | :---------------- | :-------- | :-------- | :-------- | :--------- | :--------- | | Revenue | $126.9M | $100.6M | $113.9M | +26% | +11% | | EPS | $0.03 | $(0.07) | $(0.02) | +143% | +250% | | Copper Unit Volume | N/A | N/A | N/A | +13% | -9% | CEO Commentary & Strategic Outlook Chairman and CEO Yuan Chun Tang highlighted Q2 revenue growth despite trade uncertainty, attributing it to pull-forward customer orders and strong branding for public sector projects. He also outlined strategic plans, including a rights offering to invest in new production facilities (potentially in North America) and new technologies to enhance the product portfolio, expressing optimism for long-term growth - Revenue growth in Q2 was driven by pull-forward customer orders ahead of tariffs and the company's strong branding and qualifications for public sector projects[3] - APWC plans a rights offering to invest in new production facilities, considering sites in Asia and North America, to leverage global supply chain re-alignment and low tariff rates[3] - The company is investing in new technologies to enhance its product portfolio and drive future growth, maintaining optimism for long-term potential despite near-term caution[3] Financial Performance Analysis (Q2 FY2025) Revenue Analysis APWC's Q2 FY225 revenue reached $126.9 million, marking a 26% sequential increase and an 11% year-over-year increase. On a constant currency basis, revenue grew 23% QoQ. Growth was observed across all reportable segments, with specific drivers in North Asia, Thailand, and ROW Q2 FY2025 Revenue Performance: | Metric | Q2 FY2025 | Q1 FY2025 | Q2 FY2024 | Q/Q Change | Y/Y Change | | :-------------------- | :-------- | :-------- | :-------- | :--------- | :--------- | | Total Revenue | $126.9M | $100.6M | $113.9M | +26% | +11% | | Constant Currency Q/Q | N/A | N/A | N/A | +23% | N/A | Q2 FY2025 Revenue by Reportable Segments (in millions): | Segment | Q2 FY2025 | Q1 FY2025 | Q2 FY2024 | Q/Q Change | Y/Y Change | | :-------- | :-------- | :-------- | :-------- | :--------- | :--------- | | North Asia | $22.8 | $18.9 | $19.3 | +21% | +18% | | ROW | $59.8 | $45.4 | $54.3 | +32% | +10% | | Thailand | $44.3 | $36.3 | $40.3 | +22% | +10% | | Total | $126.9 | $100.6 | $113.9 | +26% | +11% | - North Asia revenue growth was partly driven by customers pulling forward orders due to U.S. tariff deadlines and steady growth in flat wire sales from EV development[9] - Thailand revenue increased due to higher order volumes, foreign exchange appreciation, and changes in product mix. ROW revenue grew significantly from the completion of public sector projects and sustained high demand for new projects[10] Gross Profit Analysis Gross profit margin for Q2 FY2025 significantly improved to 6.8%, up from 3.6% in the prior quarter and 4.3% in the same period last year. This expansion was primarily driven by a higher margin product mix, though gains were partially offset by intensified price competition and fluctuations in copper prices and exchange rates Q2 FY2025 Gross Profit Performance: | Metric | Q2 FY2025 | Q1 FY2025 | Q2 FY2024 | Q/Q Change | Y/Y Change | | :---------- | :-------- | :-------- | :-------- | :--------- | :--------- | | Gross Profit | $8.6M | $3.7M | $4.9M | +132% | +76% | | Gross Margin | 6.8% | 3.6% | 4.3% | +3.2 pp | +2.5 pp | - Margin expansion was mainly driven by a higher margin product mix[11][13] - Gains were partially offset by intensified price competition, fluctuations in copper prices, and exchange rates[13] Operating Expenses Total selling, general, and administrative (SG&A) expenses remained largely flat in Q2 FY2025. An increase in selling expenses was offset by decreases in other expenses Q2 FY2025 Operating Expenses (in millions): | Metric | Q2 FY2025 | Q1 FY2025 | Q2 FY2024 | Q/Q Change | Y/Y Change | | :------------------ | :-------- | :-------- | :-------- | :--------- | :--------- | | Operating Expenses | $6.4 | $6.4 | $6.2 | 0% | +3% | Net Income and EPS APWC reported a net income of $0.6 million for Q2 FY2025, a significant turnaround from losses in the prior quarter and prior year. Basic and diluted earnings per share (EPS) were $0.03, reflecting substantial growth Q2 FY2025 Net Income and EPS: | Metric | Q2 FY2025 | Q1 FY2025 | Q2 FY2024 | Q/Q Change | Y/Y Change | | :---------------- | :-------- | :-------- | :-------- | :--------- | :--------- | | Net Income / (loss) | $0.6M | $(1.5)M | $(0.4)M | +140% | +250% | | EPS | $0.03 | $(0.07) | $(0.02) | +143% | +250% | Financial Position and Cash Flow (Q2 FY2025) Balance Sheet Overview As of Q2 FY2025, cash and cash equivalents decreased due to higher supplier payments, while trade receivables increased significantly driven by customer orders. Inventory levels decreased as raw materials were utilized for deliveries Q2 FY2025 Balance Sheet Highlights (vs. Q1 FY2025, in millions): | Metric | Q2 FY2025 | Q1 FY2025 | Change | | :---------------------- | :-------- | :-------- | :----- | | Cash & Cash Equivalents | $35.0 | $38.3 | $(3.3) | | Trade Receivables | $97.7 | $84.7 | +$13.0 | | Inventory | $144.5 | $149.4 | $(5.0) | - Decrease in cash and cash equivalents was mainly due to increased payments to suppliers, aligning with higher sales activities[15] - Increase in trade receivables was primarily driven by higher customer orders and pull-forward demand[15] - Inventory decreased as raw material build-up was consumed for customer order deliveries[16] Cash Flow Analysis Operating activities in Q2 FY2025 resulted in a cash outflow of $15.5 million, an increase in outflow compared to the prior quarter due to higher vendor payments. However, this outflow was lower year-over-year, benefiting from increased cash inflows from pull-forward demand and public sector purchases Q2 FY2025 Cash Flow from Operating Activities (in millions): | Metric | Q2 FY2025 | Q1 FY2025 | Q2 FY2024 | Q/Q Change | Y/Y Change | | :-------------------------------- | :-------- | :-------- | :-------- | :--------- | :--------- | | Net cash used in operating activities | $(15.5) | $(2.0) | $(22.9) | $(13.4) | +$7.4 | - Higher operating cash outflow QoQ was primarily driven by increased cash payments to vendors, despite stronger cash collections[17] - Year-over-year improvement in operating cash flow was mainly due to pull-forward demand and increased public sector purchases, leading to higher cash inflows[17] Company Information About APWC Asia Pacific Wire & Cable Corporation Limited is a Bermuda-incorporated holding company with operations across the Asia Pacific region. Through its subsidiaries, it manufactures and distributes enameled wire, power cable, and telecommunications products, also providing project engineering services. Its customer base includes appliance component manufacturers, electrical contracting firms, state-owned entities, and wire and cable dealers - APWC is a holding company operating through subsidiaries, primarily engaged in the manufacture and distribution of enameled wire, power cable, and telecommunications products[19] - The company's geographical presence includes Thailand, Singapore, Australia, the People's Republic of China, Hong Kong, and other Asia Pacific markets[19] - APWC also distributes products from its controlling shareholder and third parties, and offers project engineering services for power cable supply, delivery, and installation[19] Safe Harbor Statement The Safe Harbor Statement advises that the release contains forward-looking statements, which are subject to known and unknown risks and uncertainties that could cause actual results to differ materially. Investors are cautioned not to place undue reliance on these statements, and the Company does not assume a duty to update them - The release contains forward-looking statements identified by terms like 'believes,' 'anticipates,' 'expects,' 'estimates,' 'intends,' 'plans,' or similar expressions[21] - These statements involve known and unknown risks and uncertainties that may cause actual results to be materially different from those described[21] - Investors should not place undue reliance on forward-looking statements, and the Company does not assume a duty to update them[21] Investor Relations Contact information for investor relations is provided through Pacific Holdings Group, including a phone number and email address for inquiries - Investor Relations Contact: Paul Weber, Pacific Holdings Group, Phone: (469) 797-7191, Email: pweber@pusa.com[22] Consolidated Financial Statements (Q2 FY2025) Consolidated Income Statements This section presents the unaudited consolidated income statements for the three and six months ended June 30, 2025, and 2024, providing a detailed breakdown of revenues, costs, profits, and losses Consolidated Income Statements (in millions): | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :---------------------------------- | :------ | :------ | :------- | :------- | | Revenue | 126.9 | 113.9 | 227.5 | 214.3 | | Cost of sales | (118.3) | (109.0) | (215.2) | (200.8) | | Gross profit | 8.6 | 4.9 | 12.3 | 13.5 | | Operating profit/(loss) | 2.5 | (0.9) | (0.3) | 1.2 | | Profit/(loss) for the period | 1.4 | (0.7) | (0.9) | (0.0) | | Basic and diluted profit per share | $0.03 | $(0.02) | $(0.04) | $(0.02) | Consolidated Statements of Comprehensive Income This section provides the unaudited consolidated statements of comprehensive income for the three and six months ended June 30, 2025, and 2024, detailing the profit or loss for the period and other comprehensive income/loss components, net of tax Consolidated Statements of Comprehensive Income (in millions): | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------------------------------ | :------ | :------ | :------- | :------- | | Profit/(loss) for the period | 1.4 | (0.7) | (0.9) | (0.0) | | Other comprehensive income/(loss) for the year, net of tax | 8.9 | 0.5 | 11.0 | (10.1) | | Total comprehensive income/(loss) for the period, net of tax | 10.2 | (0.3) | 10.1 | (10.1) | | Attributable to Equity holders of the parent | 7.0 | 0.3 | 7.1 | (7.1) | | Attributable to Non-controlling interests | 3.2 | (0.6) | 2.9 | (3.0) | Consolidated Balance Sheets This section presents the unaudited consolidated balance sheets as of June 30, 2025, and the audited balance sheets as of December 31, 2024, detailing the company's assets, liabilities, and equity Consolidated Balance Sheets (in millions): | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Total assets | 361.5 | 339.9 | | Total liabilities | 136.4 | 124.5 | | Total equity | 225.1 | 215.4 | | Equity attributable to parent | 162.1 | 155.0 | | Non-controlling interests | 63.0 | 60.4 | Condensed Consolidated Statements of Cash Flows This section provides the unaudited condensed consolidated statements of cash flows for the three and six months ended June 30, 2025, and 2024, categorizing cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (in millions): | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------------------ | :------ | :------ | :------- | :------- | | Net cash used in operating activities | (15.5) | (22.9) | (17.5) | (10.8) | | Net cash (used in)/provided by investing activities | (0.9) | 0.1 | (3.0) | (0.8) | | Net cash provided by financing activities | 11.6 | 15.3 | 19.6 | 9.1 | | Net (decrease)/increase in cash and cash equivalents | (3.3) | (7.0) | 0.9 | (4.3) | | Cash and cash equivalents at end of period | 35.0 | 33.7 | 35.0 | 33.7 | Supplemental Financial Information (Q1 FY2025) Q1 2025 Consolidated Income Statements This section provides the unaudited consolidated income statements specifically for the three months ended March 31, 2025, and 2024, offering a detailed view of the first quarter's financial performance Q1 2025 Consolidated Income Statements (in millions): | Metric | Q1 2025 | Q1 2024 | | :---------------------------------- | :------ | :------ | | Revenue | 100.6 | 100.4 | | Cost of sales | (96.9) | (91.8) | | Gross profit | 3.7 | 8.6 | | Operating (loss)/profit | (2.7) | 2.1 | | (Loss)/Profit for the period | (2.3) | 0.7 | | Basic and diluted profit per share | $(0.07) | $0.00 | Q1 2025 Consolidated Statements of Comprehensive Income This section presents the unaudited consolidated statements of comprehensive income for the three months ended March 31, 2025, and 2024, detailing the comprehensive income components for the first quarter Q1 2025 Consolidated Statements of Comprehensive Income (in millions): | Metric | Q1 2025 | Q1 2024 | | :------------------------------------------------ | :------ | :------ | | (Loss)/Profit for the period | (2.3) | 0.7 | | Other comprehensive income/(loss) for the year, net of tax | 2.1 | (10.5) | | Total comprehensive loss for the period, net of tax | (0.2) | (9.8) | | Attributable to Equity holders of the parent | 0.1 | (7.4) | | Attributable to Non-controlling interests | (0.3) | (2.4) | Q1 2025 Consolidated Balance Sheets This section details the unaudited consolidated balance sheets as of March 31, 2025, and the audited balance sheets as of December 31, 2024, providing a snapshot of the company's financial position at the end of the first quarter Q1 2025 Consolidated Balance Sheets (in millions): | Metric | March 31, 2025 | December 31, 2024 | | :-------------------------------- | :------------- | :---------------- | | Total assets | 352.5 | 339.9 | | Total liabilities | 137.3 | 124.5 | | Total equity | 215.2 | 215.4 | | Equity attributable to parent | 155.1 | 155.0 | | Non-controlling interests | 60.1 | 60.4 | Q1 2025 Condensed Consolidated Statements of Cash Flows This section outlines the unaudited condensed consolidated statements of cash flows for the three months ended March 31, 2025, and 2024, presenting the cash flow activities for the first quarter Q1 2025 Condensed Consolidated Statements of Cash Flows (in millions): | Metric | Q1 2025 | Q1 2024 | | :------------------------------------ | :------ | :------ | | Net cash (used in)/provided by operating activities | (2.0) | 12.1 | | Net cash used in investing activities | (2.0) | (0.9) | | Net cash provided by/(used in) financing activities | 8.0 | (6.2) | | Net increase in cash and cash equivalents | 4.2 | 2.7 | | Cash and cash equivalents at end of period | 38.3 | 40.7 |