Kinergy Corporation (3302) H2 2024 earnings summary

Executive summary

• FY2024 revenue rose 7.1% YoY to S$99.0m, while net loss widened to S$3.6m from S$0.9m; EMS growth was offset by weaker ODM and investment results.

• Management is cautiously hopeful of improvement from expanded semiconductor front-end equipment capability and increased marketing, amid uncertain geopolitics and trade conditions.

Financial highlights

• Revenue increased 7.1% to S$99.043m; gross profit fell 10.0% to S$6.302m and gross margin declined to 6.4% from 7.6%.

• Loss before tax was S$2.842m versus S$1.019m; net loss was S$3.647m versus S$0.926m.

• EBITDA was S$2.991m, down 22.7%; EBIT loss widened to S$1.989m from S$0.356m.

• Basic and diluted loss per share increased to 0.68 Singapore cents from 0.28 cents.

• Other income rose to S$8.873m, primarily from S$8.143m carry income on an investment fund reaching end of life; this supported results but is fund-related.

Outlook and guidance

• Management expects potential improvement from expanded capability to build semiconductor front-end equipment and stronger efforts to secure complete-machine orders for customers’ China markets.

• Advanced negotiations include building complete equipment in Nantong for the largest customer’s China market, with discussions also underway on load ports and Singapore-made wafer fabrication equipment.

• Management is pursuing new customers, improving corporate effectiveness and developing advanced-packaging equipment through potential M&A; no earnings guidance was stated.

• Shanghai Genlight plans to raise additional funds and pursue opportunities after profitable exits and the establishment of two new funds in 2024.