PETALING JAYA: Supermax Corp Bhd
returned to the black in its fourth quarter ended June 30, 2026 (4Q26), largely lifted by an average selling price (ASP) spike and recognition of deferred tax assets, though analysts caution that the turnaround may be temporary.
The company had a strong finish to the financial year 2026 (FY26), recording a 4Q26 net profit of RM80.32mil, compared to its net loss of RM51.65mil a year ago.
Revenue jumped to RM217.3mil, marking a rise of 71% quarter-on-quarter and 43% year-on-year. Despite this, Supermax reported cumulative net loss of RM153.87mil for the full year.
BIMB Research said it is mindful that the exceptionally strong 4Q26 was partly underpinned by higher revenue from a temporary uplift in demand and ASPs connected to the Middle East conflict.
The stronger profits, it added, was driven by a higher topline, coupled with improved fixed-cost absorption and continued cost discipline, and supported by the positive tax gain of about RM45mil from recognition of deferred tax assets.
It said it sees the company’s manufacturing facility in Texas, completed and handed over in June 2026, to be a key swing factor for FY27.
It added that the plant’s start-up expenses are expected to ease meaningfully from the second half of FY26 onwards, while a gradual ramp-up in utilisation and US policy support could improve operating leverage.
“The coming quarters will be crucial in determining whether Supermax can sustain positive operating earnings in a more normalised pricing environment and translate its US investment into meaningful and recurring earnings,” it said.
BIMB Research left its earnings forecast unchanged, noting that despite the unusually strong quarter, sustainability remains unproven.
It maintained its “hold” call on the stock, with an unchanged target price (TP) of 29 sen per share.
Meanwhile, CIMB Research widened its FY27 and FY28 net loss forecasts for Supermax by 41% and 5%, respectively, reflecting a normalised ASP environment and lower sales volume assumptions.
As a consequence, it also trimmed its TP to 27 sen, from 28 sen previously, while maintaining its “reduce” rating on the stock.
“We believe Supermax could remain loss-making in FY27 to FY28, in view of its relatively high-cost operating structure and the slower-than-expected ramp-up of its US operations, with only approximately 12.5% of planned capacity currently operational,” it said.
The impact of higher raw material costs is also likely to become apparent in 3Q27, putting pressure on profitability in a declining ASP climate. An earnings downcycle is anticipated to limit further valuation upside, CIMB Research said.
