ISOTeam Ltd.

Singapore · Building maintenance & estate upgrading

SGX: 5WF · Information cut-off 26 August 2026

What ISOTeam does

ISOTeam was founded in 1998, incorporated in its present form in December 2012 and listed on Catalist on 12 July 2013. Its financial year ends 30 June. It maintains and upgrades buildings, overwhelmingly public housing estates, and reports four segments:

• Repairs and Redecoration (R&R) — S$23.4m of FY2026 revenue, 22.2% of the total. Cyclical repainting and facade work. The company describes this as “recurring in nature: every 5 years by regulation”.
• Addition and Alteration (A&A) — S$46.6m, 44.1%. Estate upgrading under HDB's Neighbourhood Renewal, Home Improvement, Selective Lift Replacement and related programmes. Described as “recurring in nature: every 10 years by regulation”.
• Coating and Painting (C&P) — S$13.7m, 12.9%. Specialist coatings, including the heat-reflective “cool paint” systems that MND has made mandatory for more than 10,000 HDB blocks on their five-year repainting cycle.
• Others — S$22.0m, 20.8%. Home retrofitting, landscaping, interior design, mechanical and electrical works, renewable-energy installation, vector control and handyman services. This is the only segment that grew in FY2026, up 15.6%, which the company attributes to more renewable-solutions contracts completed and delivered.

The group operates through eleven wholly owned subsidiaries. It states that over 80% of revenue comes from the public sector. Two new subsidiaries — ISOTeam EleD Engineering (electrical engineering) and RIT Workforce and Resources (A&A and R&R) — were incorporated on 1 July 2026, the day after the balance-sheet date, and are recorded in the results announcement as a subsequent event.

Where the FY2026 margin came from

The headline of FY2026 is that revenue fell 11.3% to S$105.7m while gross profit rose 1.3% to S$19.4m. Gross margin went from 16.03% to 18.30%, a gain of 2.3 percentage points and the highest figure since FY2017.

The company gives one cause, and gives it identically in the results announcement, the press release and the presentation: reduced cost of sales due to savings from the conversion of part of the Group's headquarters into a workers' dormitory to house its own workers, partially offset by energy-related costs due to geopolitical development in the Middle East. The chief executive repeats it in the press release: margin strengthened mainly because of cost savings from housing some of our workers at the converted space within our head office.

This is an unusually specific and unusually checkable explanation for a margin move. Foreign-worker accommodation is a real and rising cost line for Singapore contractors, and ISOTeam owns its headquarters at 8 Changi North Street 1, so converting a floor removes a third-party rent. The company is extending the same idea: it disclosed in the FY2026 presentation that it is in the midst of acquiring 68 Loyang Way for $5.69 mil for operational expansion, part of which is to become a factory-converted dormitory with an estimated 200 to 400 beds for its own foreign workers, on a leasehold running to 6 November 2037.

The longer record puts the recovery in proportion. An 18.3% gross margin is the best in nine years, but it is still well below the 24.7% to 26.1% the company earned in FY2015 to FY2017, and the years in between include two in which gross margin was effectively zero.

The repainting segment, and why FY2024 is the wrong place to measure from

Repairs and Redecoration — the five-year regulated repainting cycle, the work ISOTeam has done since 1998 and the segment its own materials describe as recurring by regulation — went from S$50.4m in FY2024 to S$28.8m in FY2025 to S$23.4m in FY2026. That is a fall of 53.5% in two years, and on its own it invites the conclusion that the core is disappearing. The longer series does not support that conclusion.

FY2024 was the highest R&R year in the fourteen-year record. The four years before the FY2023 recovery averaged S$28.0m: S$27.3m in FY2019, S$26.3m in FY2020, S$29.5m in FY2021 and S$29.2m in FY2022. FY2024's S$50.4m is 80% above that run-rate. Against the run-rate rather than against the peak, FY2026's S$23.4m is 16.5% lower, not halved — a soft year in a cyclical segment, which is a different statement.

The same is true of the wider cycle. The group's own description puts Coating and Painting on the same statutory repainting demand as R&R. Taken together the two segments were S$37.1m in FY2026, against an FY2020–FY2022 average of S$37.5m — essentially unchanged. Splitting them and measuring the smaller half from its best year produces most of the apparent collapse.

What the segment note does show is that the FY2024 volume was unprofitable at the margin. R&R segment profit peaked in FY2023, not FY2024, at S$7.293m on S$35.619m of revenue — a 20.5% segment margin. FY2024 then added S$14.804m of R&R revenue, a 41.6% increase, and segment profit fell to S$5.052m. The extra work carried a negative incremental margin: S$14.8m more revenue, S$2.2m less profit. The segment margin halved, from 20.5% to 10.0%. In the two years since, the volume has gone back out and part of the margin has come back — 12.2% in FY2025 and 12.8% in FY2026, still well short of FY2023.

So the honest reading of the last three years is not that a regulated segment vanished. It is that the group took on a large tranche of low-margin repainting work in FY2024, earned less profit on more revenue, and has since let that volume go. That is consistent with the selectivity the company does not claim and the margin recovery it does — and unlike the version of this section published on 27 August 2026, it is supported by the segment note rather than contradicted by it.

The company's explanation for the FY2026 revenue decline, given once and applied to all three core segments together, is the timing of revenue recognition, which is influenced by project commencement and completion. In the second half it also notes that R&R revenue rose 14.2% year on year, to S$11.3m from S$9.9m, so the segment stopped falling within the year even though the full-year figure was down.

Who the revenue comes from

Every annual report since the 2013 listing discloses customers contributing 10% or more of group revenue. The series is not in any single filing, and it moves a long way.

* FY2022 is disclosed at a different threshold — see below. Shares are computed against each year's revenue as most recently restated, so FY2022 uses S$96.5m.

The single largest customer relationship in the record is FY2019's. One customer produced S$38.7m, or 28.3% of that year's S$136.6m of revenue, in A&A and Others. That is more than the whole R&R segment earned in any year of the series. The filings do not name it, and do not say when the relationship ended; by FY2020 the largest customer was S$11.6m.

FY2022's disclosure changed the threshold rather than the answer. The FY2022 note reads: revenue from 2 (2021: 2) of the Group's major customers who individually contributed 6% (2021: 10%) or more of the Group's revenue. The accounting standard requires disclosure at 10%. Reporting at 6% keeps two customers in the table in a year when, on the standard threshold, the answer would have been what FY2023 and FY2024 went on to report: none. The change is disclosed in the note itself and is not concealed — but a reader comparing FY2021 with FY2022 without noticing the parenthesis is comparing two different questions.

What is in the profit

Reported profit before tax fell 14.1%, from S$6.665m to S$5.724m. That comparison is distorted at both ends by items in other income, and the direction reverses once they are removed.

FY2025's other income of S$3.720m included a S$2.678m fair value gain on an unquoted investment — a non-cash revaluation of the group's holding in a variable capital company, which the company itself calls a one-off and which is 72% of that year's other income. FY2026's other income of S$2.001m includes a S$0.678m fair value gain on the convertible-bond derivative, also non-cash, and S$0.565m of bad debts recovered.

On that basis the operating result improved by 12.4% on revenue that fell 11.3%. The two halves of FY2026 were very different from one another, though, and in the opposite direction to the year before: first-half revenue fell 18.9% year on year but first-half profit after tax rose 41.2%, while second-half revenue fell only 2.1% and second-half profit after tax fell 51.8%, from S$3.246m to S$1.566m. The company does not comment on the half-on-half reversal beyond the line-item explanations.

Two further items sit inside the FY2026 result. Finance costs rose 13.3% to S$2.513m, which the company attributes to the unwinding of interest expense on the host liability component of the convertible bonds issued in FY2026. Other operating expenses rose to S$0.807m from S$0.601m, which it attributes to equity-settled share-based compensation; the cash-flow statement puts share-based payments at S$0.776m for the year, against S$0.552m in FY2025.

Does the profit become cash?

It has not, over the recovery so far. Across FY2023 to FY2026 the group reported S$17.953m of cumulative profit attributable to shareholders and generated S$0.485m of cumulative operating cash flow — a conversion of 2.7%. After S$3.408m of capital expenditure over the same four years, cumulative free cash flow was negative S$2.9m.

The gap is almost entirely one line. Cash generated before working capital was S$33.9m over the four years, which is more than the reported profit; contract assets then absorbed S$26.0m of it. That is work performed and certified but not yet billed, so it is not a loss and it is not a write-off — it is revenue the group has recognised and not yet been paid for. The distinction matters: an unbilled balance that converts is a timing problem, and one that does not is something else. The filings do not age the balance, so a reader cannot tell which.

What can be said from the filings is how the gap was funded. Over the same four years the group raised S$20.3m of new capital — a S$10.267m rights issue in August 2023, a S$7.0m placement in September 2025 and S$3.0m of convertible bonds — against S$0.5m of operating cash flow. The recovery in reported profit since FY2022 has been financed by shareholders and lenders rather than by the business.

The year-on-year improvement is real, but the bridge shows its limits. Receivables and payables together released S$1.9m in FY2026 after absorbing S$9.2m in FY2025, a S$11.1m swing. Contract assets moved the other way by S$7.7m. Operating cash therefore improved mainly because the smaller working-capital lines stopped consuming cash, not because the unbilled project balance converted.

Source: FY2026 results announcement, consolidated statement of cash flows. Cash-effect change is recomputed from the filed lines.

The order book, and the indicators that turned first

The order book stood at S$185.3m at 1 July 2026, up from S$161.9m a year earlier and the highest reading since 30 June 2024. New work secured has risen for three consecutive half-years: S$31.3m, S$36.4m, S$43.5m and S$56.7m. FY2026 new wins of S$100.2m against revenue of S$105.7m give a book-to-bill of 0.95 times, against 0.57 times in FY2025.

Because a contractor recognises revenue as work is performed, the order book leads reported revenue. Over the three years for which both are disclosed, the opening 30 June order book converted into next-year revenue at 74.0% (FY2024), 61.7% (FY2025) and 65.3% (FY2026) — an average of 67.0%.

The as-filed record, FY2013 to FY2026

Every row is taken from that year's own full-year results announcement, as first reported. Where a later filing restated the year, the restated figure is in the next section rather than substituted here.

Three features stand out. Revenue peaked at S$136.6m in FY2019 and has not come near it since. The three years FY2020 to FY2022 produced S$44.074m of cumulative losses attributable to shareholders as first reported, against S$44.523m of FY2013-FY2019 profits. The severe historical drawdown remains evident, but the losses do not exceed those first-seven-year profits on this stated basis. And the recovery since FY2023 has restored margin faster than scale: FY2026 gross margin of 18.3% is above FY2019's 15.8% on 23% less revenue.

Three of fourteen years were restated downward

Reading each year's announcement against the next year's comparative column shows that three years were re-presented at a materially worse figure after they were first published.

FY2018 is the one that changes a sign: a reported pre-tax profit of S$0.262m became a pre-tax loss of S$0.797m, with cost of sales restated from S$68.914m to S$70.838m on unchanged revenue. FY2022's restatement moved revenue as well, from S$99.878m to S$96.483m, and took the loss attributable to shareholders from S$9.954m to S$13.244m. On the restated figures the FY2020 to FY2022 losses total S$49.3m rather than S$44.1m.

Balance sheet, debt and unbilled work

Net assets rose from S$48.4m to S$60.1m and net asset value per share from 6.79 to 7.51 cents. Most of that increase came from issuing shares rather than from earnings: the group raised S$7.0m in a placement and S$3.0m in convertible bonds during the year, against S$4.9m of profit.

Borrowings and lease liabilities fell from S$47.2m to S$42.3m and cash rose from S$17.2m to S$19.0m. The company reports its gearing ratio improving from 1.0 to 0.7 times and its quick ratio from 1.5 to 1.8 times.

Two features of the funding structure are worth naming precisely.

The debt is short. Of the S$42.3m total, S$30.0m falls due within twelve months or on demand — S$23.1m of secured term loans, S$1.25m of unsecured term loans, S$5.06m of short-term securities loans and S$0.63m of lease liabilities — against S$19.0m of cash, of which S$2.33m of fixed deposits is pledged and S$0.375m is restricted collateral, leaving S$16.25m that the cash-flow statement treats as cash and cash equivalents. S$30.2m of borrowings is secured on fixed deposits, the group's leasehold properties, a first fixed charge over financed receivables, and corporate guarantees from the company and a subsidiary.

Part of it is not bank debt. The S$5.06m “short-term securities loan” is described in note 14 as the issuance of tokenised short-term commercial papers on a regulated digital private market platform to fund the Group's working capital requirements. The presentation identifies two such issues during the year, Series 004 of up to S$5.43m in March 2026 and Series 005 of up to S$5.06m in June 2026, on the SDAX platform. The convertible bonds are S$3.0m in principal, unsecured, 4% a year, due September 2028 and convertible at S$0.09126 a share with a floor of S$0.08126 in a takeover situation.

And the work is billed late. Contract assets — work performed and certified but not yet invoiced — stood at S$48.2m, up S$6.8m in the year, and equal to 45.5% of FY2026 revenue against 34.7% a year earlier. That single movement absorbed S$6.8m of the S$9.7m of operating profit before working capital. Operating cash flow was still much better than the year before, at S$4.2m against S$0.1m, helped by a S$0.6m release from receivables and a S$1.3m increase in payables. Capital expenditure was S$1.0m.

The annual report ages the smaller balance and not the larger one. AR2025's credit-risk note sets out a six-bucket provision matrix — not past due, 1–30 days, 31–60, 61–90, 90 days to a year, more than a year — but the note says in terms that it covers trade receivables. Of the S$10.116m of gross receivables it covers, S$1.445m was more than a year past due and a further S$0.119m was credit-impaired: 15.5% of that balance had been outstanding for over a year. The contract-asset balance in the same note is S$41.470m gross — four times larger — and carries no ageing at all, only a single loss allowance of S$0.100m, or 0.24%. The note groups the two together for measurement on the basis that they shared the same credit risk characteristics and days past due; the days past due are then published for one and withheld for the other.

The borrowings carry covenants, and three years ago the group could not meet them. Note 22 of the FY2023 annual report records that the Company and the subsidiaries received waiver from its banks to comply with certain financial covenants for the financial year ended 30 June 2023 as the Company and the subsidiaries were unable to meet these covenants, and that subsequent to the end of the financial year, the breaches of the banks' covenants have been rectified after the rights issue. The rights issue is the one described below: 347,170,931 shares completed on 24 August 2023 raising S$10.415m gross. So the first and largest of the three capital raisings of the last three years was, on the company's own account, what cured a covenant breach. The auditors did not attach a going-concern emphasis to the FY2023 accounts.

The debt stack, instrument by instrument

The S$3.0m convertible bond does not appear as one S$3.0m liability. At 30 June 2026 the host debt component was S$2.132m and the embedded derivative liability was S$0.462m; the income statement also carried a S$0.678m fair-value gain on that derivative. The cash principal, accounting carrying value, finance-cost unwind and potential share count are therefore four different numbers. Full conversion at S$0.09126 would create about 32.9m shares, while a qualifying offer can reset the conversion price no lower than S$0.08126.

Source: FY2026 results announcement notes 14 and 15 and the contractual-maturity disclosure.

The share count has more than doubled in three years

Shares in issue including treasury went from 348.4m at 30 June 2023 to 801.7m at 30 June 2026, an increase of 130%. Three events did it:

• A rights issue of 347,170,931 shares allotted on 22 August 2023, which credited S$10.267m to share capital — roughly 2.96 cents a share — and very nearly doubled the count on its own.
• A placement of 86,158,138 shares at S$0.08126, completed on 23 September 2025, raising gross proceeds of S$7,001,210.
• Performance share plan issues: 3,225,000 shares in January 2024, then 1,084,000 and 6,000,000 shares in January 2026.

Treasury shares have been unchanged at 1,195,659 since before FY2024, 0.2% of the total, with no sales, transfers, cancellations or use during FY2026. Excluding treasury, 800,484,000 shares were outstanding at 30 June 2026. The S$3.0m of convertible bonds would add about 32.9m shares at the S$0.09126 conversion price if fully converted.

One further capital event sits in the FY2025 statement of changes in equity: a cancellation of S$20.0m of share capital, credited against accumulated losses, which is why the group could show accumulated profits of S$20.5m at 30 June 2025 having carried accumulated losses of S$4.0m a year earlier. It moves nothing in cash or net assets.

Against that, the declared FY2026 dividend of 0.11 Singapore cents — up from 0.08 cents — costs about S$0.88m on 800.5m shares, which is 18.0% of the S$4.903m attributable profit. The stated policy, set out in the FY2023 and FY2024 annual reports and repeated on page 20 of the FY2026 presentation, is a payout of at least 25.0% of net profit after tax for FY2024, rising to at least 30.0% from FY2025, in each case excluding non-recurring, one-off and exceptional items.

On the company's own basis the policy has been met, and the annual reports say so. AR2024 states a payout ratio of 26.4% of net profit after tax excluding non-recurring, one-off and exceptional items for FY2024, against a 25% commitment. AR2025's financial highlights page states 0.08 cents / share · 30% Proposed dividend and payout ratio for FY2025, against a 30% commitment. Both were disclosed in the annual report rather than in the results announcement.

What the reader cannot do is check either figure. The company publishes the ratio and the denominator's label, but never the excluded items. A 26.4% payout on a 0.08-cent dividend implies a FY2024 denominator of roughly S$2.1m — against S$6.513m of reported attributable profit, a gap of about S$4.4m that is nowhere itemised. The FY2025 ratio of 30% implies a denominator near S$1.9m against S$5.132m reported. So the exclusions are large, they move the ratio by more than the dividend does, and the same 0.11-cent dividend for FY2026 could land anywhere between 18% of reported profit and comfortably above 30% of an adjusted figure that has not yet been published.

S$5.79m of the raise has not been spent

The use-of-proceeds table in the FY2026 announcement is short and unusually clear. Of S$9.652m of net proceeds from the September 2025 placement and convertible bonds:

Sixty per cent of the money raised was earmarked for painting drones and none of it has been spent, eleven months after the placement completed. The FY2026 presentation gives the programme status as technical upgrades in process, further test-bedding ongoing, a live demonstration and application to industrial building structures proposed in 2Q FY2027, and fleet expansion forecast by 4Q FY2027. The company's strategy slide states the drones can potentially reduce painting time by 30% to 40%, and that a twenty-year exclusive relationship with Nippon Paint for the public sector supports the cool-coating and drone-painting initiatives.

There is an earlier timetable, and the programme has missed it four times. The page as first published said no earlier timetable existed to score the current dates against. It does, in the company's own results releases:

Read in sequence, the painting drone has been at late stage since February 2024, its commercialisation date has moved from late 2024 to end-2025 to 2Q 2026 to FY2027, and the regulatory permit it was said to hold in February 2025 has not produced a commercial launch eighteen months later. That is the record the current 2Q and 4Q FY2027 dates should be read against.

What the filings do say about the programme. The inspection drones are real and deployed: a five-year collaboration with H3 Dynamics from October 2021, renewed in July 2023 as a two-plus-one-year agreement; more than 800 facade inspections completed by February 2024; over 233 HDB blocks secured by February 2023; and a fleet of inspection and washing drones placed under ISOTeam BuildTech. The painting drone is the separate, later, unfinished programme, developed with Acclivis Technologies and Nippon Paint under a November 2021 memorandum.

Ownership and governance

The FY2026 announcement is signed by David Ng Cheng Lian as Executive Chairman and Anthony Koh Thong Huat as Chief Executive Officer; both have been directors since the company's incorporation on 12 December 2012. The FY2025 annual report lists Foo Joon Lye (also a director since incorporation), Teo Ho Pin, Ryota Fukuda, Jeremiah Huang WeiQuan and Yap Soon Yong on the board. The presentation records two senior appointments in July 2026: Ben Teo as Chief Operating Officer and Lim Xin Deng as Chief Financial Officer. It also records that the Contracts Director, Lim Kim Hock Johnny, retired at the end of his re-employment contract and was not replaced.

Related-party purchases were S$3.812m in FY2026 against S$4.224m in FY2025. The company confirms it has not obtained a general shareholder mandate for interested person transactions under Catalist Rule 920(1)(a)(ii), and confirms under Rule 704(10) that no person in a managerial position in the company or its principal subsidiaries is a relative of a director, chief executive or substantial shareholder. Undertakings from all directors and executive officers under Rule 720(1) have been procured. The sponsor is Hong Leong Finance Limited.

The group carries S$7.353m of unquoted equity shares measured at fair value through profit or loss and classified at Level 3 of the fair value hierarchy — 12.2% of attributable net assets. The announcement states that the valuation is determined by reference to the quarterly reports issued by the VCC's professional fund manager based on the income approach method and that the measurement was performed by the Group's finance team, based on evidence obtained from the investee company. The balance did not move in FY2026. It moved by S$2.678m in FY2025, and that gain was 52% of that year's reported profit attributable to shareholders.

What the holding is, is disclosed — not in the FY2026 announcement, but in the FY2023 annual report, and it is more specific than the FY2026 language suggests. The sub-funds hold ISOTeam's own former subsidiaries. On 12 December 2022 the group disposed of its entire investment in SG Bike Pte. Ltd., ISOTeam Access Pte. Ltd. and ISOTeam Green Solutions Pte. Ltd. to Multi-Asset Growth Strategy VCC, described in that report as a Singapore-based private equity fund manager. The consideration was not cash. MGS VCC issued ISOTeam the entire 551,000 participating shares of Strategic-Asset VCC Sub-Fund and the entire 2,915,500 participating shares of Greater Heights VCC Sub-Fund — 3,466,500 shares in all. Greater Heights holds ISOTeam Access; Strategic-Asset holds SG Bike and ISOTeam Green Solutions. The group recorded a loss of control on the basis that the participating shares carry no right to vote at a general meeting of either sub-fund.

The consideration ISOTeam received for three of its own subsidiaries has therefore been written up by S$3.886m since receipt, through profit, on a valuation the group's own finance team performs from the fund manager's quarterly reports. Redemption is not open-ended, but it has moved twice: the FY2025 annual report records that on 30 November 2023 the company extended the redemption period by 12 months, and on 1 December 2024 extended it by a further 24 months, to 30 November 2027.

The valuation method is disclosed; the numbers inside it are not. AR2023 states that management valued both sub-funds on the Group's share of the fair value of the underlying net assets of portfolio companies invested as per the quarterly report issued by the VCC's professional fund manager, on an income approach method, and market approach method respectively, and warns that because of the inherent uncertainty of the valuation, management's estimate of fair values … may differ significantly from the values that would have been used had a ready market existed. AR2025 repeats the method as net asset value of the sub-funds on an income approach.

What the share price did

ISOTeam closed at 6.5 Singapore cents on 27 August 2026, the session after the FY2026 results, on 6.3m shares against a median daily volume of 1.5m over the preceding year. That is a 52-week low. The shares are down 26.1% over twelve months and up 51.2% over three years, and have traded between 3.3 and 10.2 cents across that window.

One pattern in the record is worth stating because it is mechanical and repeated: the first session after each of the last four results announcements was a fall, and each came with a volume spike.

Fifteen single-session moves of 7% or more were detected over the three-year window. Four of them carry an evidenced reading. The 28 August 2025 fall of 9.1% follows the FY2025 results filed the previous evening. Three others are mostly the market or the sector rather than the company: on 7 April 2025 the shares fell 15.1%, but the median of the three listed Singapore contractors in this library — OKP, Civmec and Beng Kuang Marine — fell 11.9% the same session, leaving a residual of 3.2 points. Against the Straits Times Index alone the residual would have been 7.6 points and the move would have looked company-specific; the sector control is what settles it.