$POHUAT (7088.MY)$ Earnings continue to be weighed down by weakness in the U.S. furniture market, with revenue falling 34%, gross margin turning negative, and the company posting a loss. However, the company carries zero bank debt and holds approximately RM260 million in cash and short-term investments, resulting in a very strong balance sheet and no near-term solvency concerns. Future share price performance hinges on a recovery in U.S. demand and a rebound in gross margins, making it a classic cyclical stock awaiting sectoral recovery.
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