Frencken Group (E28) H1 2025 earnings summary

Executive summary

• Revenue for the six months ended 30 June 2025 rose 15.7% year-over-year to S$431.4 million, driven by strong growth in the Mechatronics division, particularly in the semiconductor, medical, and industrial automation segments.

• Net profit attributable to equity holders increased 9.9% year-over-year to S$19.9 million, with earnings per share at 4.67 cents compared to 4.25 cents in the prior year period.

• Gross profit margin slightly decreased to 14.1% from 14.8% due to higher operating costs in Europe.

Financial highlights

• Mechatronics division revenue grew 19.0% year-over-year to S$389.3 million, led by a 37.5% surge in semiconductor segment sales.

• IMS division revenue declined 8.4% year-over-year to S$40.6 million, mainly from lower automotive and consumer electronics sales.

• Gross profit increased 10.2% to S$60.9 million; profit before tax rose 5.5% to S$24.8 million.

• Net cash from operating activities was S$21.9 million; net cash used in investing and financing activities was S$5.9 million and S$19.5 million, respectively.

• Net asset value per share was S$1.04 as at 30 June 2025.

Outlook and guidance

• Revenue for the second half of 2025 is expected to remain broadly stable compared to the first half, with segment outlooks indicating stable semiconductor and medical, lower analytical life sciences, higher industrial automation, and stable automotive revenues.

• The company remains cautious due to global market uncertainties, including US tariffs, inflation, FX volatility, and geopolitical tensions.

• Long-term growth initiatives include new manufacturing facilities in the USA and Singapore, with the Singapore facility targeting completion in Q1 2027.