Formosa Prosonic Industries Berhad

$KEYFIELD / 5321 (KEYFIELD INTERNATIONAL BERHAD)
$JCY / 5161 (JCY INTERNATIONAL BERHAD)
$OCK / 0172 (OCK GROUP BERHAD)
$KOBAY / 6971 (KOBAY TECHNOLOGY BERHAD)
$FPI / 9172 (FORMOSA PROSONIC INDUSTRIES BERHAD)

$FPI / 9172 (FORMOSA PROSONIC INDUSTRIES BERHAD) Q1FY24 Takeaways

📌 YoY
1. Revenue in Q1 FY24 increased significantly to RM149.2 million, a 36.6% growth compared to RM109.2 million in the same period last year, mainly due to higher sales volumes.
2. Pre-tax profit increased by 195%, attributed to higher sales and foreign exchange gains.
3. Sales of speaker products to Wistron Corporation grew by 41% YOY, and supplied components increased by 67%.

📌 QOQ
1. Revenue for the quarter decreased by 3.1% to RM149.2 million compared to RM153.9 million in the previous quarter, primarily due to lower sales volumes.
2. Pre-tax profit decreased by 1.7% compared to the previous quarter.

📌 Advantages
1. Net Cash Company: The company maintains a strong net cash position.
2. Stable High Dividend Payout: Greater than 5%.
3. Consistent Profit Margin: Maintained between 15% - 20% over the past four quarters, thanks to the sales mix and a strong US dollar.
4. Strong Major Shareholder: Wistron Corporation, a publicly traded company on the Taiwan Stock Exchange, holds a 27% stake in FPI and is also the company’s major customer. Wistron’s sales have significantly improved this year but are still below FY2022 levels.
5. Reputable Clients: FPI's main clients are globally recognized brands, with business relationships spanning from 8 to over 30 years.
6. Market Growth: According to the Musical Instruments Global Market Report 2024, the musical instruments market is expected to grow steadily in the coming years. By 2028, the market size is projected to reach USD17.9 billion, with a compound annual growth rate (CAGR) of 4.8%, driven by increased e-commerce sales and faster urbanization.

📌 Challenges
1. Revenue Volatility: In FY2023, the company's revenue fell by 32% compared to FY2022, as speakers and musical instruments are non-essential goods and face low demand during economic downturns.
2. Customer Concentration Risk: In FY2023, three major customers accounted for 91.9% of total revenue, with the largest customer contributing 53% and the second-largest 32%.
3. Economic Pressures: High inflation and interest rates have reduced demand for non-essential goods.
4. Rising Operating Costs: Increased electricity tariffs and inflation-driven costs.
5. Foreign Exchange Risk: The company imports materials like resin, wood, and metal parts from abroad. Purchases of factory equipment and machinery are also priced in foreign currencies. While some of this risk is offset by export revenues, the remaining risk is managed through long-term contracts.
6. Intense Industry Competition: Cheaper and more accessible manufacturing tools lower the barrier to entry in this industry.
7. Cautious Sales Outlook: Management remains cautious about sales performance in FY2024 due to global economic uncertainties.

Additional Listing Announcement /Subdivision of Shares

$FPI / 9172 (FORMOSA PROSONIC INDUSTRIES BERHAD) 's Q1FY2024 Quarterly Report Summary:

# Comparing current quarter (Q1FY24) with corresponding quarter (Q1FY23):

- Rev improved by 37% to RM 149.20 mil due to higher sales vol.
- Gross profit jumped by 143% to RM 24.05 mil.
- Other income also increased significantly by 70% to RM 16.46 mil
- PBT rose by 195% to RM 36.65 mil.
- PAT also rose by 195% to RM 28.65 mil.
- Net profit margin improved from 8.9% to 19.2%.
- EPS skyrocketed from 3.78 sen to 11.20 sen.
- Net cash.
- NOCF turned positive from – RM 21.75 mil to RM 20.80 mil.

# Comparing current quarter (Q1FY24) with immediate preceding quarter (Q4FY23):

- Rev decreased by 3.1% to RM 149.20 mil due to lower sales vol,
- PBT dropped by 1.7% to RM 36.65 mil.
- PAT dropped quite a bit by 11.5% to RM 28.65 mil.
- Excluding the one-off gain on disposal of subsidiaries (RM 20.1 mil) recorded in the previous quarter, the results for the current quarter is slightly better dye to gain of foreign exchange.

# Prospects:

- The Board anticipates that the operating environment will continue to be challenging in the coming quarters.

Additional Listing Announcement /Subdivision of Shares

Change in Boardroom - MR CHEN CHING SEN

Quarterly rpt on consolidated results for the financial period ended 31/03/2024

General Meetings: Outcome of Meeting

Annual Report & CG Report - 2023

Part A - Statement to Shareholders in Relation to the Proposed Renewal of Authority for Share Buy-Back Part B - Circular to Shareholders in Relation to the Proposed Renewal of Shareholders' Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature

General Meetings: Notice of Meeting

OTHERSFormosa Prosonic Industries Berhad ("the Company") - Proposed Renewal of Shareholders' Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature and Proposed Renewal of Shareholders' Mandate for Share Buy-Back by the Company

Additional Listing Announcement /Subdivision of Shares

Changes in Director's Interest (Section 219 of CA 2016) - MR CHEN CHING SEN

DEALINGS IN LISTED SECURITIES (CHAPTER 14 OF LISTING REQUIREMENTS) : Dealings Outside Closed Period

Changes in Director's Interest (Section 219 of CA 2016) - MR CHEN CHING SEN

DEALINGS IN LISTED SECURITIES (CHAPTER 14 OF LISTING REQUIREMENTS) : Dealings Outside Closed Period

DEALINGS IN LISTED SECURITIES (CHAPTER 14 OF LISTING REQUIREMENTS) : Dealings Outside Closed Period

Changes in Director's Interest (Section 219 of CA 2016) - MR SHIH CHAO YUAN

Additional Listing Announcement /Subdivision of Shares

Additional Listing Announcement /Subdivision of Shares

$FPI / 9172 (FORMOSA PROSONIC INDUSTRIES BERHAD) ‘s latest QR is out and the results aren’t very positive. Net profit and net profit margin for FY2023 on paper might look like the company’s results are better than previous years but those numbers have taken into account 2 one-off gains item. In short, demand for speakers continues to remain subtle.

# Comparing current quarter (Q4FY2024) with preceding year corresponding quarter (Q4FY2023):

- Rev dropped by 14.8% to RM 153.94 mil due to lower sales vol.
- However, gross profit only dropped by 3% to RM 26.32 mil.
- Other Income shot up by 448% to RM 25.65 mil due to gain on disposal of subsidiary (70% equity stake in Wistron Technology (Malaysia)) amounted to RM 20.1 mil.
- Distribution costs gained 161% to RM 5 mil (increase in freight costs?)
- -Other expenses also increased by 195% to RM 5.70 mil
- PBT sill surged by 179.2% to RM 37.29 mil due to one-off gain on disposal of subsidiary.
- PAT also surged by 297.8% RM 32.39 mil.
- Net profit margin jumped from 4.5% to 21%.
- EPS jumped from 3.17 sen to 12.68 sen.
- NOCF decreased by 29% to RM 56.98 mil.
- First interim dividend of 23 sen per share was declared.

# Comparing current quarter (Q4FY2024) with immediate preceding quarter (Q3FY2024):

- Rev declined by 34.3% to RM 153.94 mil due to lower sales vol.
- PBT dropped by 39.1% to RM 37.29 mil due also to forex loss.
- Excluding one-off gain items, PBT would be at RM 17.20 mil.
- PAT also dropped by 33.7% to RM 32.39 mil.
- Net profit margin slightly improved from 20.8% to 21%.

# Comparing YTD ended 31 Dec 2023 with YTD ended 31 Dec 2024:

- Rev decreased by 31.5% to RM 673.90 mil due to lower sales vol.
- PBT would have been down by 15% to around RM 89.70 mil after excluding the one-off gain on property disposal (RM 7.5 mil) completed in 18 July 2023 and gain on disposal of subsidiaries (RM 20.1 mil). Lower forex gain also contributed to lower profitability.
- Net cash of RM 361.94 mil. Cash and equivalents works out to be around RM 1.40 per share.
- Net profit margin improved from 10.8% to 17.4%.

# Prospects:

- The Board anticipates that the operating environment continues to be challenging in the coming quarters due to still persistent strong headwinds from inflationary pressure and high interest rates.

FPI - Notice of Book Closure

Change of Company Secretary - TAN SIEW HONG

Change of Company Secretary - LIEW SHU NING

Quarterly rpt on consolidated results for the financial period ended 31/12/2023

First Interim Dividend

DEALINGS IN LISTED SECURITIES (CHAPTER 14 OF LISTING REQUIREMENTS) : Dealings During Closed Period

Changes in Director's Interest (Section 219 of CA 2016) - MR KOH MENG CHING

Additional Listing Announcement /Subdivision of Shares