KUALA LUMPUR (Nov 7): Pentamaster Corp Bhd (KL:PENTA) said its net profit fall 49.9% to RM11.77 million for third quarter ended Sept 30, 2024 (3QFY2024), from RM23.49 million a year ago, dragged down by lower automated test equipment (ATE) sales performance and foreign exchange losses.
The quarterly net profit is the lowest since 1QFY2018 when it posted a net profit of RM7.32 million.
Quarterly revenue dropped 17% year-on-year to RM150.18 million from RM180.74 million, as the ATE division’s sales fell nearly 46% to RM53.42 million. The factory automation solutions (FAS) division, however, saw its revenue grow 20.8% to RM106.62 million. No dividend was declared for the quarter.
In a bourse filing, Pentamaster said the dismal ATE performance which saw automotive related-sales fall 56.5% year-on-year, was mainly the consequence of the US and Europe tariff policies towards Chinese-made electric vehicles (EVs), that had resulted in greater market uncertainty and disruptions.
The EV market and supply chain in China have become highly competitive and disruptive, limiting its ability to fully capitalise on the expanding market locally in China, noted Pentamaster.
Nevertheless, the company’s FAS division was supported by the medical device segment as the industry progressively adopts factory automation solutions for operational efficiency, safety and adherence to stringent regulatory standards.
For the first nine months of FY2024, Pentamaster’s net profit dropped 25.4% to RM51.05 million from RM68.43 million a year ago, while revenue slipped to RM492.34 million from RM522.93 million.
On prospects, Pentamaster said it expects sluggish demand to persist across key segments, particularly in the automotive sector, for the remainder of the financial year and anticipates closing the year with a flat revenue momentum.
Despite these short-term headwinds, the company said it remains committed to addressing the challenges in the ATE segment while continuing to leverage growth opportunities within the FAS segment.
“Key initiatives are being undertaken to streamline operations and improve efficiencies which are critical steps for enhancing margins in future reporting periods,” it said.
In addition, Pentamaster is working to strengthen its presence in high-growth industries, the company said, noting the high demand for the high-performance, high-bandwidth, and low-latency chipset used in artificial intelligence, data centres, high-performance computing and advanced networking.
Shares in Pentamaster closed unchanged at RM4 on Thursday, giving the company a market capitalisation of RM2.85 billion. Year-to-date, the stock is down 13%.