Operating margins have deteriorated into negative territory, reaching -3.3% in 2024Q4, as the company fails to scale effectively despite gross margins remaining constrained between 16.9% and 20.8%.
| Sales/Revenue | 117.85M | 58.42M | 58.33M | 59.52M | 51.45M | 43.22M | 48.94M |
| Revenue Growth % | 24.49% | 0.16% | -2% | 15.7% | 19.03% | -11.68% | - |
| Cost of Goods Sold | 96.02M | 47.2M | 47.41M | 48.61M | 42.16M | 35.27M | 41.19M |
| COGS % of Revenue | - | 80.79% | 81.27% | 81.67% | 81.96% | 81.6% | 84.17% |
| Gross Profit | 21.84M | 11.22M | 10.93M | 10.91M | 9.28M | 7.95M | 7.75M |
| Gross Margin % | 18.53% | 19.21% | 18.73% | 18.33% | 18.04% | 18.4% | 15.83% |
| Gross Profit Growth % | - | 2.71% | 0.14% | 17.56% | 16.67% | 2.65% | - |
| Operating Expenses | 18.52M | 11.23M | 10.14M | 8.38M | 7.67M | 6.85M | 6.75M |
| OpEx % of Revenue | - | 19.22% | 17.38% | 14.08% | 14.91% | 15.85% | 13.78% |
| Selling, General & Admin | 17.95M | 10.46M | 9.57M | 7.91M | 7.41M | 6.61M | 6.75M |
| SG&A % of Revenue | - | 17.89% | 16.4% | 13.29% | 14.41% | 15.29% | 13.78% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - |
| Other Operating Expenses | 573K | 772K | 573K | 470K | 256K | 239K | 0 |
| Operating Income | 3.31M | -6K | 784K | 2.53M | 1.61M | 1.1M | 1M |
| Operating Margin % | 2.81% | -0.01% | 1.34% | 4.25% | 3.13% | 2.56% | 2.05% |
| Operating Income Growth % | - | -100.77% | -68.99% | 57.02% | 45.7% | 10.17% | - |
| EBITDA | 4.01M | 811K | 1.36M | 3M | 1.87M | 1.34M | 1.53M |
| EBITDA Margin % | 3.41% | 1.39% | 2.33% | 5.04% | 3.63% | 3.11% | 3.12% |
| EBITDA Growth % | 31.78% | -40.24% | -54.75% | 60.72% | 38.94% | -11.99% | - |
| D&A (Non-Cash Add-back) | 702K | 817K | 573K | 471K | 256K | 238K | 523K |
| EBIT | 3.9M | 292K | 1.37M | 2.94M | 2.49M | 1.92M | 1.87M |
| Net Interest Income | -2.27M | -1.29M | -1.24M | -1.03M | -632K | -539K | -767K |
| Interest Income | 10K | 56K | 10K | 2K | 2K | 1K | 6K |
| Interest Expense | 2.8M | 1.34M | 1.25M | 1.03M | 634K | 540K | 773K |
| Other Income/Expense | -1.29M | -1.05M | -667K | -624K | 242K | 275K | 96K |
| Pretax Income | 2.02M | -1.05M | 117K | 1.9M | 1.85M | 1.38M | 1.1M |
| Pretax Margin % | 1.71% | -1.8% | 0.2% | 3.2% | 3.6% | 3.19% | 2.25% |
| Income Tax | 384K | -656K | 109K | 275K | 325K | 8K | 127K |
| Effective Tax Rate % | 19% | 62.3% | 93.16% | 14.44% | 17.55% | 0.58% | 11.56% |
| Net Income | 1.62M | -397K | 8K | 1.55M | 1.45M | 1.37M | 972K |
| Net Margin % | 1.38% | -0.68% | 0.01% | 2.6% | 2.82% | 3.17% | 1.99% |
| Net Income Growth % | -42.49% | -5062.5% | -99.48% | 6.9% | 5.69% | 41.15% | - |
| Net Income (Continuing) | 1.64M | -397K | 8K | 1.63M | 1.53M | 1.37M | 972K |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 160K | 77K | 0 | 0 |
| EPS (Diluted) | 0.18 | -0.03 | 0.00 | 0.17 | 0.17 | 0.15 | 0.10 |
| EPS Growth % | -40.74% | - | -99.47% | 0% | 13.33% | 50% | - |
| EPS (Basic) | - | -0.03 | 0.00 | 0.17 | 0.17 | 0.14 | 0.10 |
| Diluted Shares Outstanding | 9M | 14.4M | 9M | 9M | 8.63M | 9.38M | 9.38M |
| Basic Shares Outstanding | 9M | 14.4M | 9M | 9M | 8.63M | 9.51M | 9.38M |
| Dividend Payout Ratio | - | - | - | - | - | - | - |
Operational margin volatility
As indicated by the historical quarterly data, INEO's revenue growth remains highly inconsistent, oscillating between a 30.1% surge in 2023Q2 and a 10.1% contraction in 2024Q2, suggesting that the company struggles to maintain a stable demand base across its specialized industrial and automotive aftermarket segments.
The erratic top-line performance implies that INEO is highly susceptible to the cyclicality of its end markets, such as mining and energy. Without a clear upward trend, the company appears to be operating in a mature, fragmented niche where market share gains are difficult to sustain.
Based on the reported financial statements, INEO's gross margin has remained compressed within a narrow 16.9% to 20.8% range, reflecting a cost structure that is heavily burdened by raw material inputs and an inability to pass through inflationary pressures to its industrial customer base.
The lack of significant margin expansion suggests that the company lacks meaningful pricing power, effectively acting as a price-taker in a commoditized manufacturing environment. Investors should monitor whether the company can optimize its casting processes to improve these thin margins, as current levels leave little room for operational error.
According to recent income statement filings, INEO's operating income has failed to scale with revenue, culminating in a negative operating margin of 3.3% in 2024Q4, which highlights the company's inability to achieve the necessary manufacturing scale to cover its fixed administrative and overhead expenses.
The transition from positive operating income in previous periods to a loss in the most recent quarter indicates a breakdown in operational efficiency. This suggests that the company's cost base is too rigid to adjust to revenue fluctuations, potentially threatening long-term viability if volume does not recover.
As evidenced by the lack of R&D investment in the provided data, INEO faces a significant long-term risk as the industrial sector shifts toward alternative power, potentially rendering its core combustion engine replacement parts business obsolete without a clear strategic pivot or technological adaptation.
Short-sellers would likely focus on the company's inability to generate consistent net income and its reliance on aging engine fleets. The absence of R&D spending suggests a potential terminal value risk that may not be fully reflected in the current valuation, warranting further investigation into the company's long-term product roadmap.
Quick answers to the most common questions about buying INEO stock.
For fiscal year 2025, INNEOVA Holdings Ltd (INEO) reported total revenue of $58.4M. This represents a 19.4% increase compared to $48.9M in 2020.
INNEOVA Holdings Ltd (INEO) reported a net loss of $0.4M for the fiscal year ending 2025.
INNEOVA Holdings Ltd (INEO) reported an operating income of $-0.0M, resulting in an operating profit margin of -0.0%. This margin reflects the operational efficiency of the business before interest and taxes.
INNEOVA Holdings Ltd (INEO) generated $11.2M in gross profit for the year, representing a gross profit margin of 19.2%. This demonstrates the company's core pricing power and production efficiency.