, OTS Holdings celebrated a net profit of SGD 703,000. However, the first half of 2026 (1H2026) tells a different story: a net loss of SGD 282,000.){kind=link}
A Tale of Two Semesters
In the volatile food manufacturing sector, a single year can drastically flip a corporate balance sheet. For the first half of the 2025 financial year (1H2025), OTS Holdings celebrated a net profit of SGD 703,000. However, the first half of 2026 (1H2026) tells a different story: a net loss of SGD 282,000.
This pivot from black to red requires a closer “look under the hood.” Navigating a “challenging” global environment of inflationary pressures and shifting trade patterns, the Group is currently a company in transition. While the top-line figures suggest a retreat, the underlying data reveals a strategic redistribution of resources toward regional dominance.
The Export Cliff: A 54% Reality Check
The primary blow to the Group’s top line came from a sharp contraction in international markets. Total revenue fell 15.4% to SGD 14.2 million, largely due to a massive SGD 2.1 million collapse in the “Others” segment, which covers exports. This segment saw a 54% year-on-year decline.
A granular look at geographical data shows that revenue from “Other Markets” (excluding Singapore and Malaysia) plummeted from SGD 3.7 million to just SGD 1.3 million. This volume drop led to a compression of the Gross Profit Margin, which fell from 28.3% to 24.8%. The Board identified this as the central cause of the period’s deficit:
“The loss is mainly attributable to lower revenue generated, particularly in the export segment due to evolving market dynamics overseas and changes in customers’ order patterns.”
The Malaysia Growth Story: A Contrarian Success
While global exports stalled, the Group’s regional strategy in Malaysia provided a vital silver lining. Revenue from the Malaysia market rose by 13.5%, reaching SGD 2.5 million. This growth was driven by actual consumer demand in the General Trade and Modern Trade segments.
It is critical to distinguish this operational success from balance sheet movements. While a strengthening Malaysian Ringgit (MYR) provided a SGD 0.6 million translation gain on the Group’s property assets, the revenue growth reflects genuine market traction. Malaysia is no longer just an adjacent market; it is becoming a core engine for long-term resilience.
The “Private Label” War in the Supermarket Aisles
The “Modern Trade” segment, tracking sales to major supermarkets, reported a 5.3% revenue decline. In an era of high inflation, the supermarket aisle has become a battlefield where heritage brands face “intensified competition” from retailers’ own house brands.
OTS Holdings, the manufacturer behind established names like Golden Bridge, Kelly’s, and Orchid Brand, is feeling the squeeze. Even innovative lines like the plant-based A-New and halal-compliant El-Dina must navigate a market where shoppers increasingly stretch their dollars with lower-priced private label alternatives.
Strategic Austerity: No Bonuses and Tightened Belts
Management has pivoted to a period of “disciplined execution” to mitigate operational losses. Administrative expenses dropped 9.7%, a decrease driven by strategic austerity. Most notably, the Group implemented cost-cutting measures that included the total absence of December performance bonuses in 1H2026.
Marketing and distribution costs were also slashed by 20.2% to align with lower sales. These internal cuts allowed the Group to report a “Total Comprehensive Income” of SGD 99,000. This figure was salvaged by a SGD 381,000 exchange gain from foreign operations, proving that tight fiscal discipline is currently keeping the Group’s head above water.
Investing in the Future: The $22 Million Property Play
Despite the net loss, OTS Holdings is doubling down on infrastructure. Non-current assets remain robust, with Property, Plant and Equipment (PPE) rising to SGD 22.1 million. This includes a significant SGD 3.2 million investment in the Johor, Malaysia facility for renovation, machinery, and equipment.
This represents a “short-term pain for long-term gain” scenario. The company reclassified SGD 2.3 million from “other non-financial assets” to PPE, signaling that the renovation phase is largely complete. However, the facility is currently a “sleeping giant” waiting for final certifications and approvals from local authorities before it can fully ramp up.
Conclusion: The Road to Resilience
The road ahead for OTS Holdings remains paved with headwinds. Geopolitical uncertainties in the Middle East and Ukraine, coupled with sustained high global meat prices and increased freight costs, continue to stress supply chains. The transition from a Singapore-centric player to a regional giant with a massive Malaysian footprint is a high-stakes move.
As the company waits for its Johor facility to go fully operational, a fundamental question remains for investors. Is a company’s decision to cut internal performance bonuses to fund a regional factory the ultimate sign of long-term survival? For OTS Holdings, the answer depends on how quickly those new Malaysian production lines can offset the export cliff.
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