KUALA LUMPUR (April 29): ACE-Market bound electronics manufacturing solution provider Cnergenz Bhd is optimistic on its prospect amid the reopening of borders after more than two years of closure due to the Covid-19 pandemic.
At a press conference after the prospectus launch on Friday (April 29), its chief executive officer Lye Yhin Choy is hopeful to restore the group’s financial performance to pre-pandemic level as sales from overseas are set to improve following the reopening of borders.
“2020 and 2021 are the Covid-19 years, so we are unable to travel to other countries, especially to Thailand and Vietnam to provide our solutions to clients there. Also, some equipment cannot even go in without the expertise of our technical staff.
“Right now, we foresee there will be a high demand growth when the borders open up. [In fact,] there are a lot of inquiries coming in, especially from Vietnam.
“We are very upbeat about the prospect going forward. It (our financial performance) could be back to pre-pandemic level or even better once the borders are fully opened up and then we can travel and can get everything back to normal states,” he added.
Cnergenz posted a lower profit after tax of RM13.06 million in the financial year ended Dec 31, 2021 (FY21), down from RM16.07 million in FY20, as well as RM30.55 million in FY19 — prior to the pandemic outbreak.
Its revenue dropped from RM255.98 million in FY19 to RM132.82 million in FY20, before clawing back to RM152.95 million in FY21.
Apart from the border reopening, Lye said the catalyst for the group is the continued expansion of the electronics and semiconductor industries.
“We are seeing an exponential demand for electronics and semiconductor products fuelled by the technologies of the Fourth Industrial Revolution. The corresponding drive for rapid technological advancements has thus led to new product innovations and advancements as well as automation of production facilities," he elaborated.
Lye also said the group would benefit from increasing trends for multinational companies shifting their supply chain activities out of China into Southeast Asia amid the US-China trade spat.
The Penang-based firm expects to raise RM58 million in its initial public offering (IPO). The bulk of the proceeds or RM37.8 million has been earmarked for the expansion of its operation facility.
Another RM10 million will be used for working capital requirements, RM6 million will be allocated for research and development expenditure, while the remaining RM4.2 million will be used to defray the estimated listing expenses.
The IPO involves the public issue of 100 million shares and an offer for sale of 50 million offer shares by way of private placement at the IPO price of 58 sen per share.
Cnergenz is expected to list on ACE Market of Bursa Malaysia on May 24, 2022.