Marco Polo Marine’s Profit Skyrocketed 170%. The Real Story is Even More Surprising

Marco Polo Marine recently reported a stunning financial result: net profit attributable to shareholders surged by an incredible 170% in FY2025, rising from S21.7 million to S58.5 million. While this headline figure is impressive, it doesn’t tell the whole story. The details buried in the company’s financial report reveal a more complex and fascinating business transformation happening just beneath the surface.

Takeaway 1: The Secret Behind the Profit Surge Wasn’t Just Business as Usual

A significant portion of the profit increase came from “extraordinary gains” that are not part of normal operations, a point the company highlighted in its own profit guidance. These one-off accounting and financial events were the primary drivers of the massive bottom-line growth.

The key items include:

• A S$22.4 million reversal of impairment loss on property, plant and equipment.
• A S$5.9 million reversal of impairment loss on an amount due from a joint venture.
• A S$3.2 million gain from the disposal of an investment in a joint venture.

Combined, these three items totaled S31.5 million, accounting for over 85% of the S36.8 million year-over-year profit increase. This is a crucial distinction. While the final profit number looks spectacular, it was heavily influenced by these one-time events rather than being purely a result of year-over-year operational performance.

Takeaway 2: While Profit Soared, Overall Revenue Stood Still

Here is the first major clue that a deeper story is unfolding: despite the massive profit growth, the Group’s full-year revenue for FY2025 actually saw a marginal decrease of 1%, falling to S122.8 million from S123.5 million in FY2024. This stark contrast between soaring profits and stagnant revenue is a classic indicator that management is actively reshaping the company’s revenue profile, prioritizing profitability over pure top-line growth.

Takeaway 3: A Tale of Two Divisions—One Powering Ahead, One Scaling Back

The flat overall revenue figure masks a dramatic divergence between the company’s two main business segments. The financial results show a clear two-speed performance, indicating a deliberate change in focus.

• Ship Chartering Operations: Revenue grew by 12% to S$80.2 million, driven by the fleet’s expansion with the new Commissioning Service Operation Vessel (CSOV), MP Wind Archer, and three new Crew Transfer Vessels (CTVs).
• Ship Building & Repair Operations: Revenue decreased by 17% to S$42.6 million, a result of a reduction in third-party shipbuilding projects.

This isn’t a sign of trouble but a clear strategic pivot. The company is strategically shifting its shipyard focus away from lower-margin, third-party shipbuilding and toward higher-value ship repair services, a move supported by its recent investment in a fourth drydock.

Takeaway 4: The Strategic Pivot is Making the Company More Profitable

This shift in focus toward ship chartering had a direct and positive impact on profitability. The Group’s overall gross profit margin improved significantly, rising to 44% in FY2025 from 39% in FY2024. The company’s own report explains this improvement clearly:

The improvement in overall gross margin is primarily attributed to the higher revenue contribution from the Ship Chartering Operations, which typically commands higher margins compared to the Ship Building & Repair Operations.

Takeaway 5: The Underlying Business is Stronger Than Ever

To understand the true health of the core business, we can look at its EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization), adjusted to remove the one-off gains. Even after excluding the extraordinary items, the Group’s EBITDA increased to S50.1 million in FY2025 from S42.7 million in FY2024. This represents a robust 17.3% growth in the company’s core operational earnings, confirming the success of their strategic focus.

Further bolstering this view, the Group’s net gearing remained at Nil, a powerful indicator of its strong financial health (meaning the company holds more cash than debt).

The headline-grabbing 170% profit jump is largely rooted in one-off accounting gains. However, the real story is a successful and ongoing strategic shift toward the high-margin ship chartering business, a move that has made the company fundamentally stronger and more profitable at its operational core. This raises the key question for the future: With its new, high-margin vessels now contributing for a full year and a fourth drydock set to boost shipyard capacity, can Marco Polo Marine translate its sharper strategy into top-line revenue growth in FY2026?

WATCH THE EXPLAINER VIDEO BELOW:

LISTEN TO THE PODCAST BELOW:

Related stories: Nam Cheong’s Q3 2025 80% Profit Collapse Explained