The group is cautiously optimistic that this growing trend will continue throughout the remainder of 2024.
PETALING JAYA: Citing encouraging numbers from the Semiconductor Industry Association, Frontken Corp Bhd
is hopeful about its prospects, seeing much better utilisation of its second facility in Taiwan on increasing demand.
The group is cautiously optimistic that this growing trend will continue throughout the remainder of 2024. It believes that the persistent demand of chips will be positive for its semiconductor business in years to come, where continuing high demand for the same will necessitate more chip research, design and manufacturing in the years ahead.
Frontken released its results for the third quarter of 2024 (3Q24) ended Sept 30, which saw net profit surging by 32% year-on-year (y-o-y) to RM35.3mil, as revenue grew 8.1% to RM144.3mil.
Net earnings for the nine months ended Sept (9M24) also increased 20% y-o-y to RM98.7mil, driven by a 13.9% rise in turnover to RM419.7mil. The group attributed the strong results primarily to higher contributions from its subsidiary in Taiwan.
“Volume in the semiconductor space picked up due to higher demand and strong orders from our customers which benefited our Taiwan subsidiary,” it said in a filing with Bursa Malaysia yesterday, adding that the rising demand had paved the way for the aforementioned higher utilisation of its facility.Additionally, Frontken said a better product mix in its semiconductor division was also a contributing factor to the positive 9M24.
Compared to the quarter ended June 30, revenue was 7% higher from RM134.9mil, mainly due to higher contributions from its subsidiaries in Taiwan and also to some extent its business units in Malaysia and Singapore in the oil and gas sector.
This resulted in a 6% quarterly increase in the group’s net profit from RM33.3mil.
Frontken did not declare any dividend for the quarter in review, leaving the dividend announced year-to-date at 1.7 sen per share, which was declared in 2Q24.
It said its strategy moving forward is to keep observing current issues, especially those possibly giving rise to geopolitical tension, while continuing to focus on the quality of its services as well as on its operational efficiency.
Quoting the Semiconductor Industry Association, Frontken said the global semiconductor industry sales hit US$53.1bil in August 2024, an increase of 20.6% compared to August 2023’s total of US$44bil and 3.5% more than the July 2024 total of US$51.3bil.
With such increase in global sales, Frontken said it is also seeing increasing demand from its customers.
