HIGHWAY HOLDINGS OPENS FISCAL 2027 WITH 29% YOY REVENUE GROWTH, 58% YOY GROSS PROFIT GROWTH AND RETURN TO OPERATING PROFITABILITY

Rhea-AI Summary

Highway Holdings (Nasdaq: HIHO) reported Q1 fiscal 2027 revenue of approximately $2.0 million, up 29.2% year-over-year, with gross profit rising 58.4% to $835,000 and gross margin expanding about 800 basis points to 42%. Operating income was $59,000 versus a prior-year operating loss of $138,000, reflecting improved mix and cost control.

Net income attributable to shareholders increased 78.7% to $109,000, or $0.02 per diluted share, despite non-operating income falling to $26,000 from $134,000 due to a prior property-disposal gain. SG&A rose 16.7% to $776,000 but declined as a share of sales to 38.8%. The company ended June 30, 2026 with $3.9 million in cash, $4.0 million of working capital, a 2.4:1 current ratio and $5.5 million in shareholders’ equity. Management highlighted contributions from the Regent-Feinbau acquisition, stabilization in OEM operations and plans to diversify through product-focused partnerships after the loss of a major Myanmar customer.

Positive

• Revenue growth 29.2% YoY to approximately $2.0 million in Q1 FY2027
• Gross profit up 58.4% YoY to $835,000; margin expanded to about 42%
• Operating swing to $59,000 income from $138,000 loss year-over-year
• Net income to shareholders up 78.7% YoY to $109,000; EPS $0.02 vs. $0.01
• SG&A leverage: expenses up 16.7% but down to 38.8% of sales from 43.0%
• Liquidity: $3.9 million cash, $4.0 million working capital, 2.4:1 current ratio

Negative

• SG&A expenses increased 16.7% YoY to $776,000 in Q1 FY2027
• Non-operating income fell to $26,000 from $134,000 due to prior property gain
• Cash balance declined to $3.9 million from $4.4 million at March 31, 2026
• Loss of major Myanmar customer created a significant disruption in operations

Market reaction after 1Q27 earnings report: HIHO +19.66% in the Jul 20 session

+19.66% 531.3x vol

136 alerts

+19.66% Session close to close

+121.2% Peak Tracked

-14.8% Trough Tracked

$4.30M Market Cap

531.3x Rel. Volume

In the Jul 20 session, HIHO gained 19.66%, reflecting a significant positive market reaction. Argus tracked a peak move of +121.2% during that session. Argus tracked a trough of -14.8% from its starting point during tracking. Our momentum scanner triggered 136 alerts that day, indicating very high trading interest and price volatility. Trading volume was exceptionally heavy at 531.3x the daily average, suggesting very strong buying interest.

Data tracked by StockTitan Argus on the day of publication.

Market Context

The stock surged +19.7% in the session following this news. HIHO's prior acquisition announcement dr...

Analysis

The stock surged +19.7% in the session following this news. HIHO's prior acquisition announcement drew a -3.04% 24-hour reaction, providing a historical comparison for this profitability update. Current peers were mixed, while the prior negative reaction remains a sourced comparison risk.

Key Figures

Revenue: $2 million Gross profit: $835,000 Gross margin: 42% +5 more

8 metrics

Revenue $2 million Q1 fiscal 2027, up 29.2% year-over-year

Gross profit $835,000 Q1 fiscal 2027, up 58.4% year-over-year

Gross margin 42% Q1 fiscal 2027, versus approximately 34% a year earlier

Operating income $59,000 Q1 fiscal 2027, versus a $138,000 operating loss

Net income $109,000 Attributable to shareholders, Q1 fiscal 2027

Diluted EPS $0.02 Q1 fiscal 2027, versus $0.01 a year earlier

Cash $3.9 million At June 30, 2026

Working capital $4.0 million At June 30, 2026

Historical Context

3 past events · Latest: Mar 26 (Negative)

Pattern 3 events

Date	Event	Sentiment	24h Move	Catalyst
Mar 26	Nasdaq deficiency notice	Negative	-5.0%	Nasdaq minimum bid-price deficiency and potential delisting risk
Mar 05	Acquisition completion	Positive	-3.0%	Completed 51% Regent-Feinbau acquisition for €662,000
Mar 02	Quarterly earnings report	Negative	-6.5%	Nine-month revenue decline and net loss amid customer losses

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

HIHO's selected prior news events all had negative 24-hour price reactions; two were aligned with negative news and one diverged from positive acquisition news.

Key Terms

gross margin, diluted eps, current ratio, non-operating income

4 terms

gross margin financial

"Gross margin expanded approximately 800 basis points year-over-year to 42%"

Gross margin is the difference between how much money a company makes from selling its products and how much it costs to produce them, expressed as a percentage of sales. It shows how efficiently a company is turning sales into profit before other expenses like marketing or salaries. Higher gross margin means the company keeps more money from each sale, which is a good sign of financial health.

View in glossary

diluted eps financial

"diluted EPS doubled year-over-year to $0.02"

Diluted earnings per share (EPS) shows how much profit a company makes for each share of stock, assuming all possible shares from stock options or convertible securities are used. It provides a more conservative estimate than basic EPS, accounting for potential share increases that could dilute ownership. Investors use diluted EPS to get a clearer picture of a company's true profitability on a per-share basis.

current ratio financial

"with a current ratio of 2.4-to-1"

The current ratio measures a company’s short-term ability to pay upcoming bills by comparing assets that can be turned into cash within a year (like cash, inventory, and receivables) to obligations due within the same period. Investors use it like a household budget check — a ratio above 1 suggests the company has more short-term resources than immediate debts, while a very low or very high ratio can signal liquidity risk or inefficient use of assets.

View in glossary

non-operating income financial

"despite substantially lower non-operating income"

Non-operating income is money a company earns or loses from activities outside its main business — for example interest, investment gains or losses, and one-time sales of assets. Investors watch it because it can inflate or mask the health of the core business: think of it as a shop owner’s extra income from renting out a back room rather than from selling products, which can boost short-term profits but may not reflect sustainable performance.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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• Gross margin expanded approximately 800 basis points year-over-year to 42%
• Net income attributable to Highway Holdings shareholders increased 79% year-over-year to $109,000; diluted EPS doubled year-over-year to $0.02
• Quarter-end liquidity remained solid with $3.9 million in cash, $4.0 million in working capital and a 2.4-to-1 current ratio

HONG KONG, July 20, 2026 /PRNewswire/ -- Highway Holdings Limited (Nasdaq: HIHO) today reported financial results for the first quarter of fiscal year 2027 ended June 30, 2026. On a year over year basis, first fiscal quarter 2027 revenue rose 29% and gross profit increased 58%, while the Company produced a $197,000 operating-profit improvement despite substantially lower non-operating income.

Net sales for the first quarter of fiscal year 2027 increased 29.2% to $2 million compared to $1.5 million in the first quarter of fiscal year 2026. Gross profit increased 58.4% year-over-year to $835,000 from $527,000, while gross margin expanded to approximately 42% from approximately 34% in the year ago period, an improvement of roughly 800 basis points. The Company generated operating income of $59,000 in the first quarter of fiscal year 2027, a $197,000 improvement from an operating loss of $138,000 in the prior-year quarter.

Net income for the first quarter of fiscal year 2027 increased 78.7% compared to the year ago period to $109,000, or net income of $0.02 per diluted share, compared with net income of $61,000, or net income of $0.01 per diluted share in the first quarter of fiscal year 2026. The increase was achieved despite total non-operating income declining to $26,000 from $134,000, which included an $82,000 gain on the disposal of an underutilized property in the prior-year period.

Roland Kohl, chairman, president and chief executive officer of Highway Holdings, commented, "The first quarter marked clear progress in our turnaround. Revenue increased 29% year over year, gross profit rose 58.4% and gross margin expanded by approximately eight percentage points. We also moved from a $138,000 operating loss a year ago to $59,000 of operating income, demonstrating the earnings leverage in our core business as revenue mix and execution improve."

"The sudden loss of a major customer's Myanmar business after 25 years due to political reasons was a significant disruption, but it reinforced the need to diversify. Given the need to move decisively, we are prioritizing partnerships with established businesses that have proven products and can help us transition toward a more product-focused model while reducing our reliance on traditional OEM manufacturing. We are in discussions with several potential partners regarding established products that could benefit from our manufacturing, engineering and global operating capabilities. We will remain disciplined and move forward only where the product, partner economics, capital requirements and potential shareholder return are compelling."

"On the positive side, our continuing OEM operations have stabilized, and Regent-Feinbau contributed in its first full quarter. Importantly, our solid financial position gives us the flexibility to execute this transition. While the path forward involves challenges, we are confident in our ability to adapt, capitalize on new opportunities, and emerge stronger. Our objective is to build a more resilient company with broader customer exposure, a greater mix of product-led revenue and a sustainable path to profitability."

Selling, general and administrative expenses for the first quarter of fiscal year 2027 increased 16.7% to $776,000 in the first quarter 2027 from $665,000 in the year ago period primarily due to the recent acquisition of Regent-Feinbau, which added approximately $164,000 in SG&A expenses in the first quarter of fiscal year 2027. Importantly, revenue still grew faster than overhead, reducing SG&A expenses to 38.8% of sales from 43.0% a year earlier. As a result, the Company generated operating income of $59,000, a $197,000 improvement from an operating loss of $138,000 in the prior-year quarter.

The Company recognized a $2,000 currency exchange gain in the first quarter of fiscal year 2027, compared to $4,000 in the first quarter of fiscal year 2026. Interest income was $21,000 in the first quarter of fiscal year 2027. The year ago period included an $82,000 gain on the disposal of a small underutilized real property. The Company does not engage in foreign currency hedging activities.

The Company ended the first quarter of fiscal year 2027 in a solid financial position with $3.9 million of cash and cash equivalents. At June 30, 2026 the Company had a working capital balance of $4.0 million, with a current ratio of 2.4:1, and total shareholders' equity of $5.5 million, compared to $5.4 million as of March 31, 2026.

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 the prospects of its newly acquired Regent-Feinbau business, the resumption of operations of its Myanmar operations, economic, competitive, governmental, political and technological factors affecting the company's revenues, operations, markets, products and prices,  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)
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HIGHWAY HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Statement of Income
(In thousands of U.S. dollars, except for shares and per share data)
	Quarter Ended
	June 30
	2026		2025
Net sales	$1,999		$1,547
Cost of sales	1,164		1,020
Gross profit	835		527
Selling, general and administrative expenses	776		665
Operating income (loss)	59		(138)
Non-operating income (expense):
Exchange gain (loss), net	2		4
Interest income, net Gain (loss) on disposal of assets	21 -		43 82
Other income (expense)	3		5
Total non-operating income (expenses)	26		134
Net income (loss) before income taxes	85		(4)
Income taxes	13		61
Net income (loss)	98		57
Net loss/(profit) attributable to non-controlling interests	11		4
Net income attributable to Highway Holdings Limited's	$109		$61
Shareholders
Net income (loss) per share – Basic	$0.02		$0.01
Net income (loss) per share - Diluted	$0.02		$0.01
Weighted average number of shares outstanding:
Basic	4,584		4,445
Diluted	4,584		4,445

 

HIGHWAY HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Balance Sheet
(In thousands of U.S. dollars, except for shares and per share data)
	June 30	March 31
	2026 (unaudited)	2026 (audited)
Current assets:
Cash and cash equivalents	$3,856	$4,409
Accounts receivable, net of doubtful accounts	1,195	1,023
Inventories	1,623	1,452
Prepaid expenses and other current assets, net	192	253
Total current assets	6,866	7,137
Property, plant and equipment, net	363	389
Intangible assets, net	510	532
Goodwill	260	260
Operating lease right-of-use assets, net	2,212	2,424
Long-term deposits	179	179
Long-term loan receivable	75	75
Total assets	10,465	10,996
Current liabilities:
Accounts payable	$457	$437
Operating lease liabilities, current	855	844
Accrued expenses and other current liabilities	1,216	1,509
Current portion of long-term loan payable	146	162
Income tax payable	87	162
Dividend payable	81	81
Total current liabilities	2,842	3,195
Operating lease liabilities, non-current	1,524	1,742
Deferred tax liabilities	176	190
Long term accrued expenses	26	26
Non current portion of long-term loan payable	390	407
Total liabilities	4,958	5,560
Shareholders' equity:
Preferred shares, $0.01 par value	-	-
Common shares, $0.01 par value	46	46
Additional paid-in capital	12,422	12,417
Accumulated deficit	(6,852)	(6,961)
Accumulated other comprehensive loss	(642)	(610)
Non-controlling interest	533	544
Total shareholders' equity	5,507	5,436
Total liabilities and shareholders' equity	$10,465	$10,996

 

View original content:https://www.prnewswire.com/news-releases/highway-holdings-opens-fiscal-2027-with-29-yoy-revenue-growth-58-yoy-gross-profit-growth-and-return-to-operating-profitability-302829246.html

SOURCE Highway Holdings Limited

FAQ

What were Highway Holdings (Nasdaq: HIHO) Q1 fiscal 2027 financial results?

Highway Holdings reported Q1 FY2027 revenue of about $2.0 million and net income attributable to shareholders of $109,000. According to Highway Holdings, gross profit was $835,000, operating income was $59,000, and diluted earnings per share were $0.02, all increasing year-over-year.

How much did HIHO revenue and gross margin grow year-over-year in Q1 FY2027?

HIHO revenue grew 29.2% year-over-year to approximately $2.0 million, while gross margin expanded to about 42%. According to Highway Holdings, gross profit rose 58.4% to $835,000, with margin improving roughly 800 basis points from around 34% in the prior-year quarter.

Did Highway Holdings (HIHO) return to operating profitability in Q1 FY2027?

Yes, Highway Holdings reported operating income of $59,000 in Q1 FY2027, versus a prior-year operating loss. According to Highway Holdings, this represents a $197,000 improvement from the $138,000 operating loss in Q1 FY2026, reflecting better revenue mix and cost structure.

What was Highway Holdings' net income and EPS for Q1 fiscal 2027 (HIHO)?

Highway Holdings generated net income attributable to shareholders of $109,000, or $0.02 diluted EPS, in Q1 FY2027. According to Highway Holdings, this compares with $61,000 in net income and $0.01 diluted EPS in the first quarter of fiscal 2026.

What is Highway Holdings’ cash and balance sheet position as of June 30, 2026?

As of June 30, 2026, Highway Holdings held $3.9 million in cash and working capital of $4.0 million. According to Highway Holdings, the company had a current ratio of 2.4:1, total liabilities of $5.0 million, and total shareholders’ equity of $5.5 million.

How did the Regent-Feinbau acquisition and Myanmar customer loss affect HIHO?

Regent-Feinbau added to Q1 FY2027 revenue and increased SG&A by about $164,000, according to Highway Holdings. Management also noted the sudden loss of a major Myanmar customer after 25 years, calling it a significant disruption and a catalyst for diversification efforts.

What strategic shift is Highway Holdings (HIHO) planning after Q1 FY2027 results?

Highway Holdings is prioritizing partnerships with established product businesses to move toward a more product-focused model. According to Highway Holdings, the strategy aims to diversify beyond traditional OEM manufacturing, broaden customer exposure, and pursue a more sustainable path to profitability after recent disruptions.