Frontken Berhad Annual Report 2023

Frontken Corporation Berhad 200401012517 (651020-T) • ANNUAL REPORT 2023 8 CHAIRMAN’S MESSAGE MANAGEMENT DISCUSSION AND ANALYSIS FINANCIAL PERFORMANCE This is the first time in many years that we have not reported a growth in both our revenue and earnings. Nonetheless, the result is still a commendable one considering the overall weakness in the main segment that we operate in. The revenue for 2023 was RM500.1 million, a slight decrease of 3% compared to last year due to lower contribution from all our subsidiaries except for the ones in Malaysia and the Philippines. The Group’s profit before tax for the year was at RM167.1 million, a 4% decrease from the preceding financial year. Our earnings before interest, tax, depreciation and amortisation (“EBITDA”) stood at RM188.4 million. Our profit after tax (“PAT”) was RM124.3 million, a decrease of 8% compared to RM135.2 million recorded a year ago. During the year, the Group continued to generate a positive cash flow of RM144.0 million from our business operations. The Group’s capital expenditure (“CAPEX”) for the year for property, plant and equipment was at RM15.2 million. Despite the cash outflows from dividend and CAPEX, the Group’s total cash balance as at 31 December 2023 remained strong at RM417.0 million. The Group’s financial position at the end of FY2023 continued to be strong with total assets standing at RM885.4 million, an increase of 10% compared to the previous year. We will endeavour to pay a sustainable dividend and return profits to shareholders that commensurate with the performance of the Group. In 2024, the Company declared a dividend of 2.2 sen per share amounting to RM34.6 million. We believe that we will be able to continue with a sustainable dividend payment, taking into consideration our financial performance, capital commitments, acquisition related activities and reserves, among others. Dear Shareholders, On behalf of the Board of Directors (the “Board”), I’m pleased to present to you the Annual Report and Audited Financial Statements of the Group for the financial year 2023 (“FY2023”). As part of this Annual Report, we have also included the Management Discussion and Analysis to provide our shareholders with a more insightful and informative details of the Group’s operation and performance. Despite a challenging operating environment, our business continued to demonstrate incredible resilience, thanks to our strong fundamentals and team of dedicated employees. It is a testament to our solid foundation, careful planning, and our flexibility to adapt to the rapidly changing business landscape.

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