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Frontken Corporation Berhad (651020-T)
ANNUAL REPORT
2016
Financial
Review
RESULTS OF OPERATIONS
in RM’000
REVENUE
EBITDA
2015
280,573
7%
2015
35,625
45%
2016
261,844
2016
51,685
NET PROFIT
EBITDA MARGIN as a % of revenue
2015
4,007
400%
2015
12.7
7%
2016
20,040
2016
19.7
REVENUE
The revenue for the Group for the financial year ended 31 December 2016 (“FYE2016”) was RM261.8 million against
RM280.6 million in the previous financial year. Overall, the Group revenue decreased by RM18.7 million or 6.7% compared
to the preceding financial year mainly due to revenue derived from the completion of ATB Project that was recorded in the
previous year. If the revenue from the ATB Project was to be excluded, revenue for FYE2016 would have been 4.5% higher
year-on-year.
REVENUE
(by customer location)
2016
RM’000
%
2015
RM’000
%
% change
in revenue
Taiwan
125,893
48
107,337
38
17
Singapore
38,408
15
35,263
13
9
Malaysia
71,166
27
113,398
40
-37
Philippines
18,061
7
15,213
6
19
Others
8,316
3
9,362
3
-11
Total
261,844
100
280,573
100
-7
An analysis of revenue by customer location showed growth in our business across the Group particularly in Taiwan, the
Philippines and Singapore. The revenue in Malaysia decreased from RM113.4 million to RM71.2 million mainly due to
revenue derived from the completion of ATB Project that was recorded in the previous year and slowdown in our customers’
business in the oil and gas industry had resulted in a drop of business for the Group’s subsidiaries engaged in that industry
in Malaysia.
The revenue in Taiwan increased from RM107.3 million to RM125.9 million in FYE2016 or a 17% increase compared to the
preceding financial year. Our subsidiary in Taiwan continue to enjoy better business performance due to the positive growth
of the semi-conductor business. The better performance for our subsidiaries in Philippines and Singapore was attributable
to growing portfolio of our sales network and semiconductor related business in Singapore remained stable, with strong
support from its customers.
EARNINGS
Earnings before interest, tax, depreciation and amortisation (“EBITDA”) of the Group for FYE2016 increased to RM51.7
million from RM35.6 million the year before. As a percentage of revenue, EBITDA increased by 7% which was mainly due to
the cost overrun suffered in the ATB project in the previous financial year.
Lower allowance for impairment loss on plant and equipment and lower plant and equipment written off had a positive
contribution to the Group’s net profit for FYE2016. The profit after tax increased by 187% to RM27.3 million from RM9.5
million in the previous financial year mainly because of our semiconductor division in Taiwan and Malaysia performed better
this year and without the losses incurred in previous financial year from the ATB project.