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 $0.02Quarter-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)
# # #
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
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SOURCE Highway Holdings Limited
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