Roma Green Finance (ROMA) Q3 2023 Earnings Report

Roma Green Finance Limited (ROMA) reported QQ3 2023 results with a challenging near-term profitability trajectory but a robust liquidity position. Revenue for the quarter stood at HKD 2.41 million, down sharply from the prior quarter (Q2 2023 revenue HKD 5.08 million), accompanied by a gross margin of approximately 32.8%. Despite the steady gross margin, total operating expenses surged, yielding an EBITDA of -HKD 2.17 million and a net loss of HKD 2.04 million for the quarter. The negative bottom line reflects elevated SG&A and selling/overhead costs relative to a modest revenue base, signaling operating leverage that remains unprocessed at current activity levels.

Liquidity remains a notable strength. The company reports a current ratio of 10.90 and a cash ratio of 7.88, with cash per share of HKD 4.71 and no debt on the balance sheet, indicating substantial liquidity even as profitability stays pressured. However, working capital efficiency raises questions: days sales outstanding (DSO) are reported at 439.87 days, suggesting extended receivable collection cycles that could impede cash flow continuity if not managed. The stock trades with a high price-to-sales ratio (~670x) and a negative enterprise value multiple, underscoring a disconnect between market valuation and current earnings power.

Looking forward, there is no formal forward guidance in the data provided. The company operates in a market with rising ESG and climate-change advisory demand in Asia, which could offer long-term growth opportunities if revenue scale and cost controls improve. Investors should monitor quarterly revenue progression, the trajectory of SG&A containment, and working capital metrics (notably DSO) to assess a path to profitability. In sum, ROMA presents a liquidity-rich stance with meaningful near-term profitability risks; the investment thesis hinges on stabilizing revenue and achieving operating breakeven while maintaining cash flexibility.