HONG KONG, July 15, 2026 /PRNewswire/ -- Highway Holdings Limited (Nasdaq: HIHO, the "Company" or "Highway Holdings") today reported results for the fiscal fourth quarter and fiscal year ended March 31, 2026. The Company notes its financial results reflect the negative impact on the Company's business of two of its major customers significantly reducing orders that had been manufactured at its Myanmar facility due to Myanmar's political instability, along with the effects of tariffs on some of our customers. In response, the Company is focused on diversifying its OEM business by adding more customers with the long-term intention of reducing its reliance on the OEM business, and views its Regent-Feinbau acquisition as the first step in that direction.
For the fiscal 2026 fourth quarter, net sales were $0.93 million compared to $1.5 million in the year ago period, reflecting the negative impacts cited above, which led to a sudden reduction in sales and inventory imbalance at the Company's customers and a material decline in new orders. Gross profit was $246,000 compared to $305,000 in the year ago period. Net loss for the fiscal 2026 fourth quarter was $1.1 million, or $0.24 per basic share, compared to a net loss of $315,000, or $0.07 per basic share in the year ago period.
Net sales for the fiscal year 2026 were $4.8 million compared to $7.4 million for the fiscal year 2025, reflecting the above noted negative impact. Gross profit for the fiscal year 2026 was $1.4 million with a gross margin of 28%, compared to $2.5 million and 33% for the fiscal year 2025. Net loss for the fiscal year 2026 was $1.5 million, or $0.33 per basic share, compared with net income of $106,000, or $0.02 per diluted share, in the fiscal year 2025.
For the year ended March 31, 2026, the Company determined that certain long-lived and right-of-use ("ROU") assets were impaired due to adverse business conditions, operating losses, political unrest in Myanmar, trade tensions and evolving global regulations. Accordingly, the Company recorded a substantially non-cash impairment charge of $125,000, consisting of $19,000 for long-lived assets and $106,000 for ROU assets, which compares to no impairment charge in the year ended March 31, 2025.
Roland Kohl, chairman, president and chief executive officer of Highway Holdings, said, "Fiscal 2026 was the most difficult year in Highway Holdings' history, and it will be a turnaround year. Despite the numerous unlucky events hitting the Company over the last four years, we take this as a learning lesson. The year exposed clear weaknesses in our customer concentration, geographic exposure, factory utilization and cost structure. Significantly, two important customers substantially ceased orders at our Myanmar facility after deciding to no longer use such facility because of Myanmar's political situation – one customer without prior warning – which led not only to the sharp sales reduction but also to the primarily non-cash impairment charge in the fourth quarter and full year 2026. This charge came in addition to the fiscal year 2024 impairment charges totaling $862,000, which included $335,000 for long-lived assets and $527,000 for ROU assets, bringing the aggregate to nearly US$1 million attributable to the same underlying factors. We responded by protecting liquidity, reducing our operating base where necessary and taking decisive steps to reposition the company. Our focus now is to turn those actions into measurable operating progress."
"The acquisition of Regent-Feinbau on March 1, 2026 gives Highway Holdings a stronger and more diversified manufacturing platform, with European customer relationships, deeper technical capabilities and exposure to demanding automotive, commercial vehicle, aerospace and industrial markets. We view the acquisition of Regent-Feinbau as a strategic reset and a significant catalyst for the Company's ultimate rebound. We are continuing our merger and acquisition activities and are actively searching for companies with product production as a long term add on solution to reduce our dependency on the OEM business, which exposed us to the immediate helplessness we experienced in regard to the actions of our OEM customers. This was a lasting lesson learned."
The company reported a $22,000 currency exchange gain for the fiscal year 2026 compared with a $124,000 currency exchange gain in the fiscal year 2025. The currency exchange gain in the current year was mainly due to the weakened Kyat. The Company does not engage in currency exchange rate hedging, and the fluctuations in the exchange rate of the RMB and Kyat are expected to affect the Company's future results.
The Company's cash balance at March 31, 2026 was approximately $4.4 million, or approximately $0.97 per basic share. Total current assets at March 31, 2026, were $7.1 million, with working capital of $3.9 million and a current ratio of 2.2:1
About Highway Holdings
Highway Holdings is an international manufacturer of a wide variety of high-quality parts and products for blue chip equipment manufacturers based primarily in Germany. Highway Holdings' administrative office is located in Hong Kong and its manufacturing facilities are located in Germany, Yangon, Myanmar and Shenzhen, China.
Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements which involve risks and uncertainties, including but not limited to economic, competitive, governmental, political and technological factors affecting the company's revenues, operations, markets, products and prices, the political situation in Myanmar, relations between the U.S. and China, and other factors discussed in the company's various filings with the Securities and Exchange Commission, including without limitation, the company's annual reports on Form 20-F.
(Financial Tables Follow)
Consolidated Statement of Income HIGHWAY HOLDINGS LIMITED AND SUBSIDIARIES Consolidated Statement of Income (Dollars in thousands, except per share data)
| |||||||
Three Months Ended | Year Ended | ||||||
March 31, (Unaudited) | March 31, (Audited) | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Net sales | $931 | $1,487 | $4,805 | $7,412 | |||
Cost of sales | 685 | 1,182 | 3,439 | 4,942 | |||
Gross profit | 246 | 305 | 1,366 | 2,470 | |||
Selling, general and administrative expenses | 1,262 | 957 | 3,548 | 3,005 | |||
Impairment of property, plant and equipment | 19 | - | 19 | - | |||
Impairment of right of use assets | 106 | - | 106 | - | |||
Operating income/(loss) | (1,141) | (652) | (2,307) | (535) | |||
Non-operating items | |||||||
Exchange gain/(loss), net | 8 | (20) | 22 | 124 | |||
Interest income | 31 | 56 | 159 | 203 | |||
Gain on disposal of assets | - | 333 | 75 | 333 | |||
Other income | 5 | 6 | 21 | 22 | |||
Total non-operating income / (expenses) | 44 | 375 | 277 | 682 | |||
Share of profits / (loss) of equity investee | - | - | - | - | |||
Net income/(loss) before income tax and non-controlling Interest | (1,097) | (277) | (2,030) | 147 | |||
Income taxes | (2) | (38) | 486 | (38) | |||
Net income/(loss) before non-controlling interests | (1,099) | (315) | (1,544) | 109 | |||
Profit / (loss) attributable to non-controlling Interests | 2 | 0 | 20 | (3) | |||
Net income/(loss) attributable to Highway Holdings Limited shareholders | ($1,097) | ($315) | ($1,524) | $106 | |||
Net income/(loss) per share: | |||||||
Basic | ($0.24) | ($0.07) | ($0.33) | $0.02 | |||
Diluted | ($0.24) | ($0.07) | ($0.33) | $0.02 | |||
Weighted average number of shares outstanding: | |||||||
Basic | 4,551 | 4,402 | 4,554 | 4,402 | |||
Diluted | 4,551 | 4,402 | 4,554 | 4,402 | |||
HIGHWAY HOLDINGS LIMITED AND SUBSIDIARIES Consolidated Balance Sheet (In thousands, except per share data) | ||
March 31, | March 31, | |
2026 | 2025 | |
Current assets: | ||
Cash and cash equivalents | $4,409 | $5,972 |
Accounts receivable, net of doubtful accounts | 1,023 | 1,022 |
Inventories | 1,452 | 1,146 |
Prepaid expenses and other current assets | 253 | 430 |
Total current assets | 7,137 | 8,570 |
Property, plant, and equipment, net | 389 | 94 |
Intangible assets, net | 532 | - |
Goodwill | 260 | - |
Operating lease right-of-use assets, net | 2,424 | 784 |
Long-term deposits | 179 | 11 |
Long-term loan receivable | 75 | 95 |
Investments in equity method investees | - | - |
Total assets | $10,996 | $9,554 |
Current liabilities: | ||
Accounts payable | $437 | $613 |
Operating lease liabilities, current | 844 | 623 |
Accrual expenses and other current liabilities | 1,509 | 1,274 |
Current portion of long-term loan payable | 162 | - |
Income tax payable | 162 | 486 |
Dividend payable | 81 | 81 |
Total current liabilities | 3,195 | 3,077 |
Long term liabilities: | ||
Operating lease liabilities, non-current | 1,742 | 187 |
Deferred tax liabilities | 190 | - |
Long term accrued expenses | 26 | 23 |
Non current portion of long-term loan payable | 407 | - |
Total liabilities | 5,560 | 3,287 |
Shareholders' equity: | ||
Preferred shares, $0.01 par value | - | - |
Common shares, $0.01 par value | 46 | 44 |
Additional paid-in capital | 12,417 | 12,178 |
Accumulated deficit | (6,961) | (5,437) |
Accumulated other comprehensive loss | (610) | (516) |
Non-controlling interest | 544 | (2) |
Total equity | 5,436 | 6,267 |
Total liabilities and shareholders' equity | $10,996 | $9,554 |
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SOURCE Highway Holdings Limited
