Favelle Favco outlook to remain challenging

PETALING JAYA: After posting a net profit decline of almost 27% year-on-year (y-o-y) in its latest concluded quarter, Favelle Favco Bhd has cautioned that its business outlook will remain challenging.

The crane manufacturer assured shareholders it would take “appropriate measures and actions” to address any challenges.

Favelle Favco also highlighted that it had secured an outstanding order book of Rm641mil as of Nov 10, in spite of the challenging operating environment.

The order book comprised contracts from several industries such as oil and gas, shipyard, construction, wind turbine and intelligent automation.

Favelle Favco’s net profit dropped by 26.89% y-o-y to Rm7.59mil in the third quarter ended Sept 30, 2022 (3Q22), mainly attributable to lower operating profits and higher finance costs.

The drop in earnings has, in turn, brought its earnings per share lower to 3.25 sen for the quarter.

The drop in profit came despite revenue rising 8.37% y-o-y to Rm146.94mil. No dividend was declared for the quarter.

Cumulatively, for the first nine months ended Sept 30, Favelle Favco recorded a reduction of 36.51% y-o-y in net profit to Rm22.7mil, while revenue fell by almost 5% y-o-y to Rm390.31mil.

“The decrease in group revenue and pre-tax profit was mainly because the crane production progress was affected by the quarantine of some of the operational staff and workers due to Covid-19 cases during the period and the higher cost due to the Ukraine war,” the group stated in a filing with Bursa Malaysia.