InnoTek (M14) H2 2023 earnings summary

Executive summary

• FY23 revenue rose 10.1% to S$205.6M and net profit increased 93.3% to S$4.358M; eighth consecutive profitable year.

• Automotive and New Field growth offset softer OA and TV/Display sales; lower scrap and rework rates supported margin expansion.

• Proposed first and final FY23 dividend of 2.0 Singapore cents per share.

Financial highlights

• FY23 gross profit rose 21.2% to S$33.0M; gross margin expanded to 16.0% from 14.6%.

• 2H23 revenue rose 10.2% to S$112.7M and gross profit increased 10.7% to S$17.3M; gross margin was 15.3%, unchanged YoY.

• 2H23 net profit fell 31.9% to S$1.252M from S$3.922M.

Outlook and guidance

• New-field projects in emerging industries, including AI GPU servers, gaming, medical and financial equipment, are expected to contribute more in FY24 as secured projects ramp up.

• Automotive strategy targets international customers and EV-related opportunities; short-term volatility is expected amid the EV transition.

• Rayong capacity expansion supports new OA orders; Vietnam TV-bezel production and business momentum are expected to accelerate in FY24.

• QCDS improvements aim to maintain competitiveness and support new project wins.