Core Points - ARB IOT Group Limited has received a notification from Nasdaq regarding non-compliance with the minimum bid price requirement of $1.00 per share [1][2] - The company has a compliance period of 180 calendar days until December 23, 2024, to regain compliance [3] - If compliance is not achieved, the company may be eligible for an additional 180-day grace period under certain conditions [4] - The notification does not have an immediate effect on the trading of the company's shares, which will continue to trade on Nasdaq [5] Company Overview - ARB IOT Group Limited specializes in providing complete solutions for the integration of Internet of Things (IoT) systems and devices, covering the entire process from design to project deployment [6] - The company aims to become a leading player in the IoT landscape within the ASEAN region, offering a wide range of IoT systems and services [6]

Financial Performance - Revenue for the six months ended December 31, 2023, was RM 31,622,948, a decrease of 74.5% compared to RM 123,521,552 for the same period in 2022[14]. - Gross loss for the period was RM 17,581,034, compared to a gross profit of RM 14,834,326 in the previous year[14]. - The company reported a loss before tax of RM 62,792,784, compared to a profit before tax of RM 2,426,806 in the prior year[14]. - Profit for the financial period attributable to owners of the company was a loss of RM 50,177,049, compared to a profit of RM 3,670,221 in the previous year[14]. - The company reported a total comprehensive loss of RM 46,795,483 for the period, compared to a total comprehensive income of RM 4,921,715 in the previous year[14]. - Basic loss per share attributable to owners of the company was RM (2.28), compared to earnings of RM 0.20 in the same period last year[14]. - The Group reported a loss before tax of RM 62,792,784 for the six months ended 31 December 2023, compared to a profit of RM 2,426,806 for the same period in 2022[158]. - The Group's loss for the period was RM 49,865,590 for the six months ended 31 December 2023[172]. Expenses and Liabilities - Administrative expenses increased significantly to RM 45,894,179, up from RM 12,627,450 in the same period last year, reflecting a rise of 263.5%[14]. - The Group's loss before tax included significant depreciation of RM 35,152,128 for property, plant, and equipment, compared to RM 7,284,888 in the previous year[153]. - The tax expense for the Group was RM 12,927,194 for the six months ended 31 December 2023, compared to RM 2,505,942 in the same period of 2022[158]. - Employee benefits increased to RM 3,094,197 for the six months ended 31 December 2023, up from RM 1,643,036 in the previous year[165]. Assets and Cash Flow - Total assets as of December 31, 2023, were RM 268,771,798, down from RM 395,703,664 as of June 30, 2023[11]. - Total liabilities increased to RM 167,606,119, compared to RM 76,865,907 as of June 30, 2023[11]. - Net assets decreased to RM 101,165,679 from RM 318,837,757 as of June 30, 2023[11]. - Cash generated from operations was RM 79,251,838, an increase from RM 47,886,552 in the previous year[23]. - Net cash generated from operating activities was RM 80,056,659, compared to RM 48,095,192 in the prior year[23]. - As of 31 December 2023, cash and cash equivalents totaled RM 30,080,568, down from RM 33,599,099 at the end of the previous year[25]. Investments and Acquisitions - The Group disposed of 100% equity interest in ARB Midware Sdn. Bhd. for a total cash consideration of RM1 on 6 October 2023[46]. - On 17 April 2023, the Group acquired 100% equity interest in ARB Synergy Sdn. Bhd. for RM1, which subsequently became a wholly-owned subsidiary[46]. - The Group disposed of 100% equity interest in ARB Synergy Sdn. Bhd. for RM1 on 27 June 2023, along with its subsidiary ARB Databook Pte. Ltd.[47]. - The Group acquired 10% equity interest in ARB Robotic Sdn. Bhd. for RM1 on 26 May 2023, making it a wholly-owned subsidiary[47]. Business Operations - The company is engaged in providing IoT solutions across four business lines, including Smart Home and Buildings, Smart Agriculture, System Development, and Gadget Distribution[27]. - The Group operates in two segments: provision of hardware and software for Internet of Things solutions, and investment holding and others[50]. - Revenues are recognized upon the transfer of control of promised products or services, reflecting the expected consideration[52]. Receivables and Impairments - Trade receivables from third parties decreased significantly to RM 2,700,000 as of December 31, 2023, down from RM 38,356,692 on June 30, 2023[74]. - The Group's lifetime expected loss provision for trade receivables was RM 2,700,000 as of December 31, 2023, compared to RM 38,356,692 on June 30, 2023[81]. - The Group's impairment for other receivables is negligible, indicating a stable credit risk environment[86]. Shareholder Information - The issued and fully paid ordinary shares remained at 26,437,500 as of 31 December 2023, with a total amount of RM 23,308,795, unchanged from the previous period[133]. - Non-controlling interests increased from RM 94,158 as of 30 June 2023 to RM 104,305 as of 31 December 2023, reflecting a growth of approximately 10.9%[137]. Future Projections - The Group expects to sell approximately 272 units of Multi-Rotor Agricultural UAVs over the next ten years, with a selling price of RM5,800 per unit, increasing by 5% every three years[115]. - Drone services are projected to generate RM342,800 per month, also increasing by 5% every three years, with an expected 608 service instances over ten years[115].

Group 1 - ARB IOT (NASDAQ:ARBB) stock is experiencing significant gains, rising 230% as of Tuesday morning, alongside heavy trading activity [1][2] - ARB BERHAD holds a 28.38% stake in ARB IOT, amounting to 7,503,858 shares out of a total of 26,437,500 outstanding shares [1] - The SEC filing indicates that ARB BERHAD has granted full power of attorney to Dato' Sri Liew Kok Leong, the chairman and CEO of ARB BERHAD [1] Group 2 - More than 7.4 million shares of ARBB stock have been traded today, significantly exceeding the average daily trading volume of approximately 1.7 million shares [2] - The nature of ARBB as a penny stock means it can experience rapid price fluctuations based on minimal news [2]

IPO and Shareholding - ARB Berhad completed its initial public offering on April 10, 2023, raising approximately $5.0 million by offering 1,250,000 ordinary shares at $4.00 each [173]. - As of October 2, 2023, ARB Berhad directly holds 94.56% of the outstanding ordinary shares following a series of dividend distributions in specie [174]. - The company aims to distribute up to 23,517,207 ordinary shares to its shareholders, pending approval, at a ratio of 14 shares for every 1,000 shares held [190]. - The company has expanded its share capital through various share issuances, including a subdivision of shares in June 2022, increasing the number of shares from 50,000 to 500,000,000 [172]. Business Operations and Structure - The company operates through various subsidiaries focused on IoT solutions, including IoT Smart Home & Building, IoT Smart Agriculture, IoT System Development, and IoT Gadget Distribution [191]. - ARB IOT Group Limited was incorporated in March 2022 as an indirect wholly owned subsidiary of ARB Berhad, focusing on IoT business operations [171]. - The company has established an IoT development ecosystem to address challenges and opportunities brought by new digital technologies, including AI, cloud computing, and 5G [192]. - ARB Berhad's restructuring and IPO have allowed for clearer segregation of business responsibilities, enhancing resource allocation for IoT growth [196]. - On October 6, 2023, ARB Berhad disposed of its subsidiary ARB Midware Sdn. Bhd. for RM1.00, indicating a strategic shift in its business structure [190]. Financial Performance - Revenue increased from approximately $10.8 million in FY 2021 to approximately $94.9 million in FY 2022, a growth of 780.7%, but decreased to approximately $51.9 million in FY 2023, a decline of 45.3% [197]. - Profit rose from approximately $4.0 million in FY 2021 to approximately $15.7 million in FY 2022, an increase of 288.4%, but fell to approximately $5.9 million in FY 2023, a decrease of 62.4% [197]. - For the year ended June 30, 2023, revenue decreased by RM200.9 million ($48.7 million) or 45.4% to RM242.1 million ($51.9 million) compared to RM443.0 million ($100.6 million) for the year ended June 30, 2022, primarily due to a softened domestic construction and property development market [302]. - Total comprehensive income for the year was RM73.4 million ($16.7 million), a decrease of RM44.7 million ($10.5 million) or 63.2% compared to the previous year [300]. - Profit before tax for the year ended June 30, 2023, was RM21.9 million ($4.7 million), a decrease of RM66.4 million ($15.4 million) or 76.6% compared to RM88.3 million ($20.0 million) for the previous year [299]. Revenue Streams - Revenue from IoT Gadget Distribution increased by RM2.9 million ($0.4 million) or 16.9% to RM20.1 million ($4.3 million) for the year ended June 30, 2023, driven by higher sales volumes of mobile gadget accessories [304]. - Revenue from IoT System Development decreased by RM204.9 million ($47.2 million) or 79% to RM54.0 million ($11.6 million) for the year ended June 30, 2023, mainly due to the absence of system integration business application services recorded in fiscal 2022 [305]. - IoT Smart Agriculture generated revenues of RM165.5 million ($35.4 million) for the year ended June 30, 2023, a slight decrease of RM0.8 million ($2.3 million) or 0.6% compared to RM166.3 million ($37.7 million) for the year ended June 30, 2022 [306]. Research and Development - ARB Lab and ARB R&D are key subsidiaries focused on research and development of IT and IoT solutions, contributing to the company's innovation strategy [176]. - The company is investing significantly in research and development to enhance existing IT solutions and develop new platforms [198]. - The R&D team consists of 6 members and focuses on enhancing existing IT solutions and developing new platforms [232]. - The company has begun exploring new sectors such as digital warehouse management systems and point-of-sale systems since 2021 [215]. Market Strategy and Expansion - The company aims to be a top IoT player in the ASEAN region, focusing on agriculture, property development, and logistics industries [204]. - The company plans to establish sales representative offices in major ASEAN cities including Jakarta, Phnom Penh, Manila, Bangkok, Hanoi, and Ho Chi Minh City [205]. - The company aims to expand its customer base in targeted ASEAN countries, leveraging local resources for market entry [229]. - The company plans to pursue horizontal or vertical acquisitions and strategic partnerships to expand market share and enhance competitive position [228]. Cost Management and Operational Efficiency - Operational improvement initiatives are expected to generate cost savings that will offset inflation in underlying costs [230]. - Cost of revenue decreased by RM152.6 million ($37.1 million) or 44.3% to RM192.2 million ($41.2 million) for the year ended June 30, 2023, in line with the decrease in revenue [308]. - Total expenses increased significantly to RM28.8 million ($6.2 million) for the year ended June 30, 2023, up from RM10.2 million ($2.3 million) for the year ended June 30, 2022, representing an increase of RM18.6 million ($3.9 million) or 182.4% [309]. Governance and Compliance - The audit committee consists of three independent directors, ensuring compliance with financial reporting processes [363]. - The compensation committee is responsible for reviewing and approving compensation structures for executive officers [364]. - The nominating and corporate governance committee assists in selecting qualified individuals for the board of directors [367]. - The company meets all regulations and standards prescribed by authorities [346]. Risks and Future Outlook - The company may require additional cash resources in the future for business expansion or acquisitions, which could lead to dilution of shareholders if additional equity is sold [336]. - There are no adverse effects anticipated from external risks such as weather conditions or industrial accidents [346]. - The IoT industry is expected to see rapid technological changes, requiring continuous innovation to remain competitive [238].

Financial Performance - Total revenue for the period ended December 31, 2022, was $27,990,381, a decrease of 32% compared to $41,123,984 in the same period of 2021[7]. - Gross profit for the period was $3,361,506, down 60% from $8,527,708 in the previous year[7]. - Profit for the financial period attributable to owners of the Company was $831,684, a significant decline from $7,458,840 in 2021[7]. - Basic earnings per share decreased to $0.05 from $0.75, a decline of 93%[7]. - Profit before tax for the period ended 31 December 2022 was $549,922, a significant decline from $7,615,578 in 2021[119]. - The Group's revenue from project management fees was $566,508 for the period ended 31 December 2022, down from $1,640,326 in 2021[114]. - The Group's revenue from the sale of goods was $27,423,873 for the period ended 31 December 2022, a decrease of 30% from $39,307,886 in 2021[114]. - The Group's tax expense for the period ended 31 December 2022 was $567,855, compared to a tax benefit of $180,639 in 2021[121]. Assets and Liabilities - Total assets increased to $94,642,040 as of December 31, 2022, compared to $69,150,613 in 2021, reflecting a growth of 37%[6]. - Total liabilities rose to $28,287,299, up from $20,506,099 in the previous year, marking an increase of 38%[6]. - Net assets increased to $66,354,741, compared to $48,644,514 in 2021, representing a growth of 36%[6]. - Cash and bank balances improved to $7,702,481 from $5,348,748, an increase of 44%[5]. - Trade receivables decreased to $22,129,196 as of 31 December 2022, down from $26,273,468 in 2021, reflecting a decline of approximately 15.8%[62]. - Other receivables increased to $2,719,121 as of 31 December 2022, compared to $0 in 2021[68]. - Total deposits decreased slightly to $1,138,865 in 2022 from $1,202,586 in 2021[68]. - The net carrying amount of property, plant, and equipment as of 31 December 2022 was $27,233,640, up from $741 in 2021[75]. - Accumulated amortization for intangible assets increased to $9,595,922 as of 31 December 2022, compared to $4,613,744 in 2021[84]. - The total cost of intangible assets remained at $38,507,266 as of 31 December 2022, unchanged from the previous year[83]. - The lease liability decreased to $9,891 as of 31 December 2022 from $41,010 in 2021[79]. - The Group's total amount due from related companies was $203,544 as of 31 December 2022, compared to $4,794,858 in 2021[72]. - The Group's total amount due to related companies decreased to $448,304 in 2022 from $8,559,572 in 2021[72]. Expenses - The company reported a significant increase in administrative expenses, which rose to $2,861,420 from $935,532, reflecting a rise of 206%[7]. - The Group's employee benefits expenses increased to $372,317 in 2022 from $217,143 in 2021[127]. - Other payables and accruals increased significantly from $200,309 in December 2021 to $4,597,526 in December 2022, indicating a rise of approximately 2200%[100]. Business Operations - The company is engaged in four business lines: IoT Smart Home and Buildings, IoT Smart Agriculture, IoT System Development, and IoT Gadget Distribution[12]. - The company was incorporated on 1 March 2022 and is primarily involved in investment holding activities[12]. - The Group operates in two segments: provision of hardware and software for Internet of Things solutions, and investment holding and others[35]. - The Group's revenue recognition policy involves recognizing revenue upon the transfer of control of products or services to customers[38]. Acquisitions and Investments - ARB Techsymbol Sdn. Bhd. acquired 49% equity interest in ARB Logistic Technologies Sdn. Bhd. for RM49,000, making it a wholly-owned subsidiary[34]. - ARB Techsymbol Sdn. Bhd. acquired 51% equity interest in ARB WMS Technologies Sdn. Bhd. for RM51,000[34]. - ARB R&D Sdn. Bhd. acquired 100% equity interest in ARB Innovation Sdn. Bhd. for RM8,000,001[34]. - ARB AI Sdn. Bhd. acquired 1% equity interest in ARBIOT Sdn. Bhd. for RM1, making it a wholly-owned subsidiary[34]. - The Group acquired an additional 1% equity interest in ARBIOT for RM1,000,000, increasing its controlling interest from 99% to 100%[113]. - The Group acquired 100% of ARB WMS Technologies Sdn. Bhd. and ARB Innovation Sdn. Bhd., with a total fair value consideration of $1,927,923, which is expected to enhance its position in the Malaysian data networking market[155]. - ARB Innovation generated revenue of $37,595,785 since the acquisition, while both subsidiaries reported a combined loss before tax of $92,837[157]. Cash Flow and Financing - The company generated net cash from operating activities of $10,898,525, compared to $3,455,755 in the previous year, indicating a substantial increase[10]. - For the period ended 31 December 2022, net cash from financing activities was USD 6,736,356, a decrease of 65.0% compared to USD 19,253,323 in the same period of 2021[11]. - Cash and cash equivalents at the end of the period increased to USD 7,613,664, up 42.3% from USD 5,348,748 at the end of 2021[11]. - The company had a repayment to the holding company amounting to USD 8,325,104, a significant increase from USD 3,984 in the prior year[11]. - The Group's liquidity management strategy includes maintaining adequate cash and cash equivalents to meet operational needs, with a focus on managing debt maturity profiles and cash flow forecasts[151]. - The proposed IPO aims to issue at least 1,200,000 new shares at a minimum price of USD 4 per share, potentially raising a minimum gross proceed of USD 4.80 million[160][161]. Risk Management - The Group's exposure to credit risk is primarily from sales made on credit terms, with measures in place to ensure customers have sound financial positions[147]. - The Group's financial risk management focuses on optimizing shareholder value while avoiding speculative transactions, with key risks identified as market, credit, and liquidity risks[145]. Corporate Governance - The company’s financial statements comply with International Financial Reporting Standards (IFRS) applicable to companies reporting under IFRS[23]. - The listing of ARB IOT Group Limited on NASDAQ was completed on 5 April 2023, following the submission of the registration statement to the SEC[162].