Net Pacific’s FY2026 Dividend Remains Absent as Cash Outflows and Borrowings Rise

Net Pacific Holdings Limited (SGX: 5QY) declared or recommended no dividend for the year ended 30 June 2026. The board said the group was not profitable. For an investor looking for income, the audited accounts released on 8 October 2026 show why a payout remains difficult to support: the group lost HK$25.4 million and used cash in its operations. [S3, p. 26] [S3, p. 77] [S3, p. 80] [S1, p. 1]

The loss is only part of the dividend picture

The HK$25.4 million figure is the group loss. HK$13.1 million of it was attributable to owners of Net Pacific; the rest was attributable to non-controlling interests. The distinction matters when reading the loss alongside the board’s decision on a dividend to the company’s shareholders. [S3, p. 77]

The group’s operations used HK$9.0 million of cash during FY2026. It also spent HK$4.1 million on plant and equipment and HK$17.9 million on leasehold land. Those are cash demands alongside the reported loss, even though the land purchase may support the luggage business over a longer period. [S3, p. 80] [S3, p. 3]

Borrowing supported the year’s cash needs

Net Pacific reported HK$30.8 million of net cash generated from financing activities. At 30 June 2026, borrowings stood at HK$43.6 million, up HK$35.8 million from HK$7.9 million a year earlier. HK$38.9 million of the June 2026 balance was classified as current. Group cash and bank balances were HK$24.0 million at that date. These figures make cash generation and debt repayment more immediate questions than the timing of a dividend. [S3, p. 80] [S3, p. 78] [S3, p. 122]

The borrowing note says certain working capital loans were repayable between October and December 2026, while fixed-rate loans were repayable between November 2026 and May 2027. Those are the terms disclosed in the annual report, not evidence that any repayment has since occurred. The directors said the group had sufficient resources to meet its obligations and forecast positive net cash balances for the following 12 months; that forecast still depends on the business generating enough income. [S3, p. 122] [S3, p. 82]

What the audit qualification means

The auditors qualified their FY2026 opinion because unresolved evidence about earlier transactions involving Jetwin could affect comparison with the period ended June 2025, including discontinued operations. The board said no Jetwin balances or transactions were included in FY2026 and expects the modification to be removed in FY2027, subject to the auditors’ assessment. The qualification should therefore stay in view when using historical comparisons; it does not, by itself, describe a new FY2026 cash outflow. [S1, p. 1] [S3, p. 72]

The audited statements also differ in presentation from the August unaudited results. For example, audited gross profit is HK$2.6 million versus HK$4.7 million previously reported, mainly because an inventory allowance was moved into cost of sales. The company says the reclassifications did not change the FY2026 loss, total equity or ending cash. Investors should use the audited figures when assessing margins and cash flow. [S2, p. 1] [S2, p. 2] [S2, p. 5]

What would change the dividend case?

Net Pacific has no fixed dividend policy. For now, the board’s stated reason for withholding a payout is the FY2026 loss, reinforced by cash used in operations and the larger borrowing balance. The next results will be more useful for income investors if they show a sustained improvement in operating cash flow and clarify how the disclosed borrowing obligations are being met. [S3, p. 26] [S3, p. 80] [S3, p. 122]