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SEC filingRevenue increased through securing more commercial and industrial projects alongside large-scale solar deliveries, while cost of sales rose in alignment. Elevated finance costs from working capital facilities and holding company advances, combined with working capital shifts, pressured liquidity despite substantial capital needs for operations and growth.
The increase in cost of sales aligned with the overall increase in revenue, primarily due to the securing of more commercial and industrial projects and delivery of multiple large-scale solar projects during the fiscal year. This reflects successful project execution across diversified segments, enabling revenue recovery while maintaining gross profit stability despite scale-up pressures.
Finance costs arose mainly from interest expenses charged by financial institutions on working capital financing under banking facilities and interest expenses from our holding company for advances. These costs eroded profitability as the business expanded, highlighting the financing burden of growth in a capital-intensive renewable energy sector.
Working capital dynamics showed changes due to a decrease in contract assets, offset by increases in trade and other receivables and a decrease in trade payables. Additionally, receivables in a key segment decreased mainly from customer collections, signaling effective cash conversion in certain areas but overall operational cash pressures from timing mismatches.
Our operations and maintenance (O&M) services play a critical role, ensuring power plants and solar PV systems operate safely and continuously at optimum capacity. The technical team addresses failures promptly to restore normal conditions, while preventive and corrective maintenance minimizes downtime and inefficiencies—essential for long-term project value and customer satisfaction.
Liquidity and capital resources remain a focus, as our business requires substantial capital to fund current operating costs, potential investments in new renewable energy assets and acquisitions, unforeseen events, and other expenses. This underscores the need for ongoing financing to support expansion amid execution demands.
Looking ahead, arrangements with approved independent engineers, customers, the Energy Commission of Malaysia, and TNB ensure proper grid connections for solar PV power plants. However, there is no assurance that contemplated investments under future plans will succeed or generate expected returns, tempering outlook with execution and market risks.