KUCHING: Borneo Oil Bhd’s food and franchise business has been boosted by the opening of additional eatery outlets.
For the second quarter ended 31 December 2025 (2Q2025), the group increased its total number of outlets by eight to 163, reflecting continued expansion, said the company, which owns the home-grown fast food chain, SugarBun.
The expansion helped the food & franchise operations (FFO) segment raise its revenue to RM20.28 million, a 10 per cent increase from RM18.35 million recorded in 2Q2024. Over the past 12 months, the group has added 24 new outlets.
Higher revenue lifted the segment’s earnings, with a pre-tax profit of RM4.3 million, reversing a loss of RM1.63 million in 2Q2024. The earlier loss was mainly due to one-off expenses incurred for the franchisees’ convention held in Kota Kinabalu, Sabah, in November 2024, Borneo said when releasing its latest quarterly results recently.
Despite the improved performance of the FFO segment, Borneo recorded a group net loss of RM34.75 million in the quarter under review (2Q2024: +RM17.52 million). This came despite revenue rising to RM22.37 million from RM19.7 million previously, mainly due to losses of RM35.65 million in the Head Office & others segment. The losses were largely attributed to a fair value loss of RM31.87 million on quoted securities in Verde Resources Inc (OTC: VRDR).
The resources & sustainable energy segment reported higher revenue of RM1.76 million compared with RM0.89 million previously, while reducing its loss to RM0.72 million from RM1.85 million.
Meanwhile, the property investment & management segment recorded lower revenue of RM0.33 million against RM0.45 million previously, but narrowed its loss to RM1.07 million from RM1.47 million.
In the immediate preceding quarter (1Q2025), Borneo posted revenue of RM18.9 million and a pre-tax loss of RM7.1 million. Revenue increased to RM22.7 million in 2Q2025, driven mainly by stronger contribution from the FFO segment. However, the pre-tax loss widened to RM33.1 million from RM7.1 million in 1Q2025 due to the fair value loss on Verde Resources.
“Despite this short-term valuation impact, the company remains confident in VRDR’s long-term prospects and anticipates a potential recovery in its market performance. On December 23, 2025, VRDR announced that it had applied to list its common stock on the Nasdaq Stock Market, and a registration statement in connection with its proposed underwritten offering has been filed with the Securities and Exchange Commission,” said Borneo.
On prospects, Borneo said Malaysia’s economic outlook remains stable, supported by resilient domestic demand, a steady labour market and continued recovery in consumer spending.
“While external uncertainties and global market volatility may persist, inflationary pressures are expected to remain manageable. These conditions are anticipated to provide a generally stable operating environment for the group in the coming quarters.
“Against this backdrop, the group will continue to strengthen its core businesses. The FFO segment is expected to sustain its growth momentum, driven by outlet expansion. The group will maintain prudent financial management and closely monitor market developments, particularly in relation to its investment portfolio, to capture potential upside opportunities.”
Borneo added: “Looking ahead, the group remains focused on executing its strategic plans, improving operational efficiency and making selective investments in growth areas. Barring any unforeseen circumstances, the board is cautiously optimistic that the group’s performance for FY2026 will be supported by its expanding operational footprint and long-term strategic initiatives.”
