Frontken 1Q net profit drops 11% to RM23.58m as Taiwan, Singapore earnings drag

KUALA LUMPUR (May 3): Frontken Corp Bhd net profit for the first quarter (1Q) ended March 31, 2023 fell 11% year-on-year (y-o-y) to RM23.58 million from RM26.52 million previously as its subsidiaries in Taiwan and Singapore recorded a slightly lower revenue.

In a bourse filing on Wednesday (May 3), the group said revenue for the quarter dipped to RM113.99 million from RM119.15 million a year earlier.

Earnings per share was down to 1.5 sen from 1.69 sen.

Frontken did not declare any dividend for the quarter.

Reviewing its performance, Frontken said the lower Taiwan and Singapore revenue was due partly to weaker demand which is somewhat typical of its first quarter.

“However, the Group’s subsidiaries in the Philippines and Malaysia performed better due to the improvement in the oil and gas industry.

“The improvement in our local business was largely due to new orders for provision of manpower supply and mechanical rotating equipment services from various contracts that the group has with the Petronas Group of Companies,” it said.

On its prospects, Frontken said global semiconductor sales continued to slow in February, decreasing y-o-y and month-on-month for the sixth consecutive month.

As for the oil and gas industry, the group said it was cautiously optimistic that business will be stronger compared to last year due to increased orders from the various contracts for provision of manpower supply and also mechanical rotating equipment services and parts that it has with the Petronas.

“The group anticipates the overall business conditions to continue to be challenging amidst the current geopolitical tension, rising interest rates and inflationary pressure.

“We will continue to focus our attention on the quality of our services and efficiencies so as to maintain our competitiveness and to deliver long term value,” it said.

At the midday break, Frontken dropped 1.64% or five sen to RM3 with 147,500 shares traded.