KOPI Earnings Preview | Key Points to Watch Amid Strong Stock Performance

According to consensus estimates from Bloomberg and Moomoo, KOPI’s full-year FY2025 expectations are as follows:

– Full-year revenue is expected to reach RM405.3 million, with profit estimated at RM61.8 million.

– Earnings Per Share (EPS): Forecasted at RM0.03

As a well-known food and beverage chain and coffee retailer in Malaysia, KOPI has attracted significant investor attention with its strong post-IPO growth trajectory. In the previous quarter alone, the company reported revenue of RM116.75 million and net profit of RM17.95 million. For the first nine months of FY2025, revenue totaled RM317.76 million, with net profit at RM44.86 million—already surpassing its full-year FY2024 results. This robust performance has provided solid support for the stock's strong rally this year.

KOPI has demonstrated remarkable revenue and profit growth in recent years, achieving a compound annual growth rate of 280% from FY2021 to FY2024. Revenue growth for FY2025 is expected to remain above 50%. The primary drivers include new store openings and increased customer traffic. Currently operating 31 stores (including specialty outlets), the company previously planned to add eight new stores in FY2026. Investors should monitor the progress of new store openings and the expansion of overseas outlets. While the coffee chain business remains the core revenue contributor, packaged food sales may emerge as a secondary growth driver, potentially delivering stronger revenue growth.

Margin compression was observed in the first nine months of FY2025, with gross profit margin declining by 4.4 percentage points compared to FY2024. This contraction was mainly due to rising costs in the fast-moving consumer goods (FMCG) segment and increased labor expenses from new store openings, where wage costs precede revenue generation. Investors should watch whether margins recover this quarter and if strategies such as supplier adjustments help improve profitability of low-margin products.

KOPI’s cash flow position offers insight into its operational strength. As of the last quarterly report, the company held over RM230 million in cash. With minimal accounts receivable—a characteristic of the retail sector—it generated operating cash flow of RM33.92 million and free cash flow of RM11.756 million in the previous quarter. This indicates strong cash generation capability even amid rapid expansion, providing capital support for continued growth.

Several factors may drive Oriental Kopi’s future growth:

– Halal Certification: Most stores have obtained halal certification, which will help expand the customer base.

– Product Innovation: The seasonal limited mooncakes launched during the Mid-Autumn Festival are expected to increase customer traffic and sales of packaged foods.

– Efficiency Improvements: With a new central kitchen enhancing operational efficiency, higher-margin packaged product sales, and selective price adjustments, analysts expect the company to maintain a net profit margin between 15% and 16%.