Micro-Mechanics (5DD) Q2 2026 earnings summary

Executive summary

• Revenue for 1HFY2026 rose 8.7% year-over-year to S$35.4 million, with 2QFY2026 revenue up 14.5% to S$18.7 million, driven by strong consumable tools sales and positive sector momentum.

• Net profit for 2QFY2026 grew 25.2% year-over-year to S$3.7 million, and 1HFY2026 net profit reached S$6.9 million, with net profit margin improving to 19.8%.

• EBITDA for 1HFY2026 rose 12.5% year-over-year to S$12.6 million, with EBITDA margin at 35.6%.

• Maintained a net cash position of S$27.2 million with no borrowings as of 31 December 2025.

• Interim dividend of 3.0 cents per share declared, with a payout ratio of 60.8%.

Financial highlights

• Gross profit margin expanded to 51.3% for 1HFY2026 and 51.1% for 2QFY2026, up from 49.1% and 47.5% a year ago, respectively.

• Earnings per share for 2QFY2026 rose 25.5% year-over-year to 2.66 cents; 1HFY2026 EPS was 4.93 cents.

• Operating cash flow remained robust at S$9.4 million for 1HFY2026, with positive cash flow of S$4.9 million in 2QFY2026.

• Net asset value per share increased to 37.82 cents as of 31 December 2025.

• Inventory at S$3.7 million, representing 5.3% of sales.

Outlook and guidance

• Industry sales forecast for 2026 revised upward to US$975 billion, with global semiconductor sales up 27.2% year-over-year in October 2025.

• Strategic focus on expanding in Arizona and Taiwan, advancing the Five-Star Factory initiative, and supporting advanced packaging and WFE investments.

• Capital expenditure of S$2.3 million planned for 2HFY2026 to support growth and equipment upgrades.

• Management will monitor geopolitical risks and trade policy uncertainties impacting the semiconductor sector.

• Continued strong performance expected in China, supported by local chip manufacturing initiatives.