We remain upbeat on Frencken (SGX:E28) on the back of the growth in its semiconductor and medical segments. Frencken’s 1Q25 revenue pointed to continued growth in the semiconductor segment, and we see it being minimally impacted by US tariffs, for now.
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1Q25 revenue in line.
Revenue for 1Q25 came in at S$216m (+11.5% y-o-y), while net profit grew 12% y-o-y to S$10m, i.e. within our estimates. Revenue was driven by the mechatronics division, where turnover expanded by 14.9% y-o-y to S$195.4m. This was offset by the 13.9% decline in the integrated manufacturing services (IMS) division to S$19.7m.
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The medical and analytical life sciences segments were largely stable, chalking sales of S$33m and S$46m due to orders ramping up in Asia. Meanwhile, Frencken’s analytical life sciences segment saw softer demand from its other customers.
The industrial automation segment’s revenue fell by 18.7% y-o-y to S$8m due to lower volume shipments by its key data storage customer from a change to higher-capacity data storage solutions. The IMS division’s revenue decline stemmed from lower numbers from the automotive (-15.7% y-o-y, S$14m) and consumer and industrial electronics (-14% y-o-y, S$4m) segments.
GPM expanded 1.1ppt to 14.8%.
No significant direct impact from US tariffs.
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Above is an excerpt from a report by RHB Securities Research. Clients of RHB may be the first to access the full PDF report @ https://www.rhbtradesmart.com/.
