Frontken registers Q2 net profit of RM20.3m, up 23%

PETALING JAYA: Frontken Corp Bhd saw a 23.1% increase in net profit to RM20.33 million, for the second quarter ended June 30, from RM16.52 million in the previous corresponding quarter, on improved revenue and better profit margins resulting from its continual efforts to improve efficiency across the group.

Revenue rose 9.3% to RM87.62 million from RM80.14 million due to the positive growth of the semiconductor business.

However, it noted that a slowdown in its clients’ business in the oil and gas sector resulted in a drop in business for the group’s oil and gas subsidiaries in Malaysia, Singapore and the Philippines. Moreover, the movement control order had resulted in some disruption in operations in Malaysia and to a lesser degree, its oil and gas business in Singapore and the Philippines.

For the six-month period, Frontken saw a net profit of RM37.34 million from RM31.92 million previously, while revenue rose to RM172.49 million, from RM163.97 million, mainly contributed by its Taiwanese subsidiary.

Frontken said it sees advancement and deployment of new innovative technologies following the rollout of 5G globally and believes developments in the electronic and technology space will be positive for its business.

“Nevertheless, the group anticipates that the overall business conditions for the remaining six-month period in 2020 will continue to be uncertain amidst global uncertainties and downside risks due to heightened concerns over the impact of the potential second wave from Covid-19 on the world economy,” it added.

As for its oil & gas business, it noted that new orders are trickling in from the various umbrella contracts for provision of manpower supply and also mechanical rotating equipment services and parts that it has from the Petronas Group.