Story-i Cuts Half-Year Loss to $387k, Raises $250k via Convertible Notes

Context and Financial Performance

Story-i Limited (ASX – SRY) has released its half-year financial results for the period ending 31 December 2024, revealing a dramatic improvement in its bottom line compared to the prior corresponding period. The company reported a loss of $386,949, a stark contrast to the $23.99 million loss recorded in the same period last year. This turnaround primarily reflects the deconsolidation and liquidation of its discontinued Indonesian Apple reseller business, PT Inetindo Infocom, which had been a significant drag on the group’s finances.

The Indonesian operations, which had suffered sustained losses over four years due to pandemic disruptions, low margins, and rising interest rates, were placed into receivership in late 2023 and formally dissolved in February 2025. This exit has allowed Story-i to focus on stabilising its core business and pursuing new strategic opportunities.

Balance Sheet and Liquidity Challenges

Despite the improved loss position, the group’s financial health remains fragile. Net liabilities increased to $1.12 million, with a corresponding working capital deficit of the same amount. Cash reserves are critically low at just $7,331 as of 31 December 2024, down from $20,736 six months earlier. Operating cash outflows of $169,405 during the half-year underscore ongoing liquidity pressures.

The company’s ability to continue as a going concern is explicitly flagged as uncertain by its auditor, who issued a qualified review conclusion citing limitations in audit evidence related to prior periods and foreign subsidiaries. The auditor also highlighted material uncertainty around the group’s capacity to meet its obligations without successful recapitalisation and additional funding.

Recapitalisation and Funding Initiatives

In response to these challenges, Story-i is actively pursuing recapitalisation strategies and new investment opportunities. During the half-year, the company raised $250,000 through the issuance of unsecured convertible notes to several investors, including Indian Ocean Capital Advisors and individual noteholders. These notes carry a 10% annual interest rate and a conversion price of $0.001 per share, but conversion is contingent on shareholder and regulatory approvals due to ASX Listing Rule constraints.

The board has expressed confidence in securing further equity funding, citing a successful track record of past capital raises. Plans are underway to raise an additional $300,000 in the fourth quarter of fiscal 2025 to support near-term funding needs and to capitalise on a newly identified business opportunity. The company has also negotiated extended terms and deferred settlements on existing loans and convertible notes to ease immediate financial pressures.

Governance and Structural Changes

During the period, Story-i saw changes in its board composition, including the appointment of Kam Leong Chan as a non-executive director and the resignation of Michael Chan as an executive director. The group also deregistered its dormant Singapore subsidiary, Story-i Pte Ltd, which had no material impact on the consolidated financials.

Importantly, the group has no current commitments or contingent liabilities, which may provide some operational flexibility as it navigates this transitional phase.

Looking Ahead

Story-i’s half-year results mark a pivotal moment as it transitions away from loss-making overseas operations and refocuses on rebuilding its financial footing. The success of its recapitalisation efforts and new investment ventures will be critical to restoring shareholder confidence and maintaining its ASX listing. However, the qualified audit opinion and ongoing liquidity challenges underscore the risks ahead.