I agree that, adjusted for forex, the core result isn't that alarming. However, the decline in revenue (RM181m in 4Q22, versus RM300m in 3Q22, and RM261m in 4Q21) cannot be explained by exchange rate. Sales to Wistron has dropped even more. So the question is will revenue be depressed in the coming quarters?
Hi Uptrending, looking at the figures I feel that Wistron is pulling away some order which they thought not to be shared for long-term but only temporary coorperation according to agreement. However, it seems to me that FPI is able to replace these orders with higher margin product from other customers, which is a good thing that we should be happy to see it (normally only strong product command a higher margin and strong product usually come with a brand owned by an excellent company).
Insiders have the advantage to react faster. However, not everyone is smart and be able to read the meaning behind the figures. Some of them might have done the wrong decision too quickly due to this advantage. The real world is full of fun.
This Q, the revenue is a disaster. Revenue lost from Wistron was not replaced with non-Wistron revenue which also came down significantly even after adjustment for forex effects.
Top line is far more important than the bottom line. Inventory is also down not speaking well for future revenues..
@Uptrending, Q4 revenue dip is due to following main reasons I think: (1) switch of product from low margin product to high margin product (low margin product is normally come with huge order but low profit). That's why if you don't count FOREX lost there is actually 8.xx sen per share earning in Q4. (2) festive season in Q4 will result in lesser output (3) back log (accumulated due to difficulty to get container and and high shipping cost) has been cleared quite a lot in Q3 so Q4 revenue would not be as much as Q3. That also explained the improved inventory level. Also, inflation peaked in Q3 last year so there will be inventory value adjustment in Q4. Therefore I think EPS 35 sen per year is sustainable in 2023 and whether or not it is able to make more I guess will depend on other external factors. The following growth will be depending on the trend of smart home, application of IoT and AI, home theater (see the trend of Netflix subscriber, for example).
The problem is that they do not provide more explanation in their QR, so we can not access the situation and know what problems they face. How long the problem will persist? They have done nothing to calm investors. Nobody likes uncertainty.
Goody99, you're right they do not do detailed explanation. But they do mention forex loss of 13 mil in Q4. Net profit of Q4 is 8 mil. So if there were no forex loss then the profit would have been 21 mil which is still an healthy level. Also, if you divided the tax by profit before tax you'll get 39% tax rate while cukai makmur only 33%. This was only around 25% in Q3 and Q3 already accumulated more than 100 mil profit before tax. So I think FPI under estimate the tax payable in Q3 and some of these tax has to be paid in Q4, and that's why 39% in Q4. If you do the same math for Q3, the EPS disregarding the 18 mil forex gain is only around 10 sen. So I think these findings should be sufficient to calm yourself. 40% of revenue but profit (without considering forex) drops only 25% QoQ so you know the most profitable business stay.
This stock fair value around rm 2.20 only bro , who ask u be a gambler to chase high , u deserve to lose money ! Ask u buy dnex but laugh at me , dnex , vstec , swift haulage is a 10 fold gain stock , dont say i never share with u ! Dont be a bodoh get dividen trap but lose 50% capital when insider dump faster than u , no need think what are the reasons behind this dump just leave right now because it s still over value !
I don't think so. Insiders are picking up at 3.xx. Who's dare or motivated to hold and turn the tide at current situation? Value investor like to wait further, only informed and organised large capital has the insight at what level it should get into the market and they are competing with each other to enter at this price. So that's why I think the storm is over.
Unless a company is a total piece of shit. Otherwise, insiders will exploit both the greed and fear of other investors. Yes they dump, but they pick up too.
And it is an open secret that these speculating insiders are not the core investors (the trading volume tells). Therefore serious investors would not simply buy and sell and react in this situation. Those who are participating actively in the trading today, they are not actually the one or important roles that decide whether or not this company will thrive or doing worse.
FPI forex loss is due to year end closing date cut off point resulting to forex loss. Although you have hedge the forex eventually will and back to next month account as forex again. I noticed that the company EPS is very much better than many other companies which the EPS is so much less but the share price is higher than this company. The director declare 21 sen dividend showing the company is still in good shape with higher cash in hand.
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21 sen dividend per year will continue to be an amount that the company is at a comfortable position to pay for FY 2023. EPS will be definitely more than enough to cushion that. And the company is definitely capable of paying a higher dividend.
Price sold down due to poor result last qtr. Dividend of 21 cents, will be EX soon on 6 th April, i.e. tomorrow lLAST day to qualify. Not bad result as EPS is around 40 cents/ yr.
It was difficult to assess its worth as q report is sketchy. I used to like this stock for its value but l bet on selling before dividend. At macro level it faced reduced consumer demand n the next few q may not be good.
Looks like going to end like the glove counters, forex exchange is just one of the disappointing factor. Sales dropped, EBITDA dropped, FPI only has 3 major customers, easily gg, run when still can.
"The Group recorded lower sales of RM180.7 million or a decrease of 39.8% in the current quarter compared to RM300.1 million in the immediate preceding quarter mainly due to lower sales volume. EBITDA dropped 76.3% to RM14.2 million from RM59.8 million in the immediate preceding quarter mainly due to lower sales and loss on foreign exchange."
Hi Pinnaclegrade, 1) Sonos' project goes to Wistron, and no longer to FPI anymore. FPI is not getting anything from there, not even the bread crust drops from the table. 2) But I think 2.66 is a good or reasonable price, even though I do not pick it up at this price.
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Posted by observatory > 2023-02-24 00:07 | Report Abuse
I agree that, adjusted for forex, the core result isn't that alarming. However, the decline in revenue (RM181m in 4Q22, versus RM300m in 3Q22, and RM261m in 4Q21) cannot be explained by exchange rate. Sales to Wistron has dropped even more. So the question is will revenue be depressed in the coming quarters?