Latest Forum Topics / Fu Yu Last:0.106 -- |
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Cash Rich Lucky Stock - Fu YU
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Joelton
Supreme |
15-Feb-2025 13:33
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Fu Yu warns of FY2024 loss due to nearly S$4 million in non-cash impairments
Excluding these, the group expects to post an operating profit and an improvement in financial performance for the fiscal year
 
MAINBOARD-LISTED plastic parts manufacturer Fu Yu : F13 -1.79% warned on Friday (Feb 14) that it expected to report a net loss for its financial year ended Dec 31, 2024, as a result of two one-off impairments totalling S$3.8 million.
 
The first relates to S$3.3 million of remaining goodwill in connection with the group&rsquo s FY2021 investment in Fu Yu Supply Chain Solutions (FYSCS). This non-cash impairment is due primarily to the cessation of the business unit&rsquo s activities in the final quarter of FY2024.
 
The second non-cash impairment involves some S$0.5 million on the property, plant and equipment of a subsidiary in China, with the recoverable amount falling below the carrying value.
 
Excluding these one-off impairments, Fu Yu expects to post an operating profit as well as an improvement in financial performance for FY2024.
 
It intends to release its financial results on or before Feb 28, alongside further details on its performance and forward strategies.
 
The group also said that an ongoing inquiry into the affairs of FYSCS is &ldquo isolated&rdquo to that business unit, and does not impact its core manufacturing division.
 
FYSCS was found to have made one or more unverifiable arrangements involving a payment of about US$3 million to a third party, which did not appear to have provided any services. There were also potential conflict-of-interest issues in the arrangement.
 
Separately, on Jan 10, Fu Yu&rsquo s largest shareholder Victor Lim called for an extraordinary general meeting (EGM) to remove two directors amid falling shareholder value and what he described as the company&rsquo s poor performance.
 
The same month, Fu Yu declined to convene the EGM, saying it had obtained legal advice stating that the requisition did not meet the legal requirements and was insufficient to invoke Section 176 of the Companies Act. The board also rejected Lim&rsquo s earlier bid for a board seat.
 
On Feb 6, the group received a second letter from Lim with similar demands.
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arkan1111
Veteran |
11-Feb-2025 09:47
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Hopefully the authority can help to investigate, something wrong here.
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TA_Expert
Supreme |
10-Feb-2025 23:55
Yells: "The World has changed" |
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What a change of tide for Fu Yu. | ||
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Joelton
Supreme |
07-Feb-2025 12:12
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Fu Yu to interview EGM requisitioning shareholder as part of supply chain unit probe
 
Fu Yu Corp, facing an EGM requisition bid from its largest shareholder, says it has uncovered unverifiable payments of more than US$2.98 million to an unnamed third party by a subsidiary that is undergoing a risk management processes investigation.
 
On Feb 6, citing an interim update from an external law firm Damodara Ong, Fu Yu says that this subsidiary Fu Yu Supply Chain Solutions, or FYSCS, paid for services which " did not appear to have been rendered" .
 
According to Fu Yu, some current and former employees have been called to give interviews as part of the investigations.
 
They include Victor Lim, Fu Yu' s director of strategy for the past four years, whose assistance has been requested for since last December.
 
Fu Yu " understands" that Damodara Ong is " in the process" of scheduling an interview with Lim through his lawyers.
 
Lim also happens to be the company' s largest shareholder with a stake of more than 29%. His earlier EGM requisition has been turned down, according to Fu Yu on Jan 31. His request to join the board has been rejected as well, says Fu Yu.
 
Lim wants to oust two of the company' s three independent directors and appoint three other IDs in turn as he is not happy with the company' s deteriorating performance.
 
In Fu Yu' s announcement on Feb 6, Lim, following the rejection last month, has on Feb 5 sent in a second EGM requisition repeating his requests.
 
Meanwhile, besides the unverifiable payments, Fu Yu says that as part of the probe on FYSCS, it has also uncovered potential conflicts of interest issues requiring deeper checks.
 
Other issues flagged included unauthorised use of an email account " [email protected]" by third parties requiring further review the secondment of an unnamed individual to FYSCS as its general manager from May 2023 to May 2024 whose conduct " raises questions" .
 
In addition, there were also " irregular" expense claims made by an unnamed former employee of FYSCS on behalf of a current employee of Fu Yu, who is also unnamed.
 
The company says it will update shareholders and " meanwhile" it " will remain focused on, and be carrying on business as usual."
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Joelton
Supreme |
01-Feb-2025 12:04
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Fu Yu will not convene requisitioned EGM investigates business unit
 
The company says it had obtained legal advice that the request is insufficient to invoke Section 176 of the Companies Act
 
THE board of directors of Fu Yu Corporation on Friday (Jan 31) announced that the company will not convene an extraordinary general meeting (EGM) requisitioned by Victor Lim, its largest shareholder.
 
In a bourse filing, the precision plastic components manufacturer said that it had obtained legal advice stating that the requisition did not meet the legal requirements and was insufficient to invoke Section 176 of the Companies Act.
 
Lim is not a member of the company as defined by the Act, even though he owns the beneficial interest in the shares described in his letter.
 
Fu Yu&rsquo s independent directors also obtained separate legal advice with similar points. They remain committed to working with the company and engaging Lim in constructive dialogue.
 
The board has considered the needs and interests of shareholders including Lim, and concluded that an EGM and any resolutions passed would be invalid and may expend company resources unnecessarily.
 
Fu Yu&rsquo s legal counsel has been instructed by the board to reach out to Lim to clarify his concerns and reasons for the requisition.
 
&ldquo The board reiterates its commitment to cooperate in assisting its members who submit valid requisitions to convene general meetings,&rdquo the company said in the filing.
 
Internal audit findings
Separately, the board announced an investigation into Fu Yu Supply Chain Solutions (FYSCS), a wholly owned subsidiary of Fu Yu, following an internal audit. The internal audit report &ndash dated Jul 26, 2024, and received by the board on Aug 7 &ndash showed that the business unit was assessed to have cause for considerable concern.
 
The report found significant weaknesses in FYSCS&rsquo risk management process that could expose the unit to unacceptable levels of risk if left uncorrected. Besides the initial scope of the report, the internal audit team also identified additional risk areas.
 
In acting on the findings of the report, Fu Yu&rsquo s board engaged law firm Damodara Ong on Oct 8, 2024, to conduct an investigation into the affairs of FYSCS. The investigation is still ongoing, with the board awaiting updates.
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Joelton
Supreme |
25-Jan-2025 13:15
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Fu Yu board rejects substantial shareholder&rsquo s directorship bid due to non-conformance with SGX&rsquo s &lsquo integrity requirements&rsquo
The company&rsquo s board remains &lsquo willing and able&rsquo to assess the board candidates proposed by substantial shareholder Victor Lim
 
PRECISION plastic components manufacturer Fu Yu Corporation&rsquo s board of directors declined to appoint substantial shareholder Victor Lim as a director due to potential non-conformance to the &ldquo directors&rsquo integrity requirements&rdquo set out by the Singapore Exchange (SGX).
 
Specifically, Fu Yu said that the board&rsquo s nominating committee (NC) relied on SGX&rsquo s listing manual rules 246(5)(a), which are to be read with the Securities and Futures Regulations 2018.
 
&ldquo The current NC remains willing and able to discharge their duties to perform the assessment of the current board candidates proposed by Lim,&rdquo the company said in a bourse filing on Friday (Jan 24).
 
Lim had earlier called for an extraordinary general meeting on Jan 9 to remove independent directors Royston Tan and Christopher Huang. He also called for the appointment of three other independent directors &ndash Gilbert Rodrigues, Ralf Pilarczyk and Yang Zhenrong. 
 
In response to queries by the Securities Investors Association (Singapore), or Sias, the company said that Lim has been a director of strategy at the company for the past four years, and that he indicated that he had a turnaround strategy.
 
&ldquo However, the NC does not hold the same view the NC also notes that Lim&rsquo s justifications were verbal, and not written,&rdquo the company said.
Fu Yu added that the board is open to engaging with Lim and has instructed its legal advisers to reach out to him for information and documents relating to the requisition.
 
The company reiterated that independent directors are not involved in the day-to-day running of the business of the group, and that it is &ldquo difficult to see&rdquo how replacing the directors would effectively improve the performance of the company and its share price.
 
It added that the board has not had disagreements with management. The company had earlier published its strategic direction with its corporate and business update on Nov 28, 2023.
 
&ldquo In the board&rsquo s view, the execution of these strategies will be necessary to drive the company&rsquo s financial turnaround, and pave the way for future growth,&rdquo the company said.
 
Furthermore, Fu Yu said that it is at the tail end of its internal re-tooling and transformation, which will provide a &ldquo strong business foundation to secure customers in new markets and improve operational efficiencies&rdquo .
 
&ldquo Already, the group has recorded increases in orders and higher interest to increase order volumes in recent months, partially driven by customers looking to stockpile inventory in response to an expected rise in US-China trade tensions,&rdquo the company said.
 
Fu Yu added that the company is in the initial stages of prototyping, design iterations and mould development for new clients it secured in FY2024.
 
The group&rsquo s unaudited FY2024 financial results are expected to be released at the end of February 2025, Fu Yu said.
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TA_Expert
Supreme |
18-Jan-2025 02:18
Yells: "The World has changed" |
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The company is mismanaged over the years. This is the last contract manufacturer that is still listed on the SGX. With such a dismay performance in the operations of the company, it shows something very serious rooted in the management. |
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Joelton
Supreme |
17-Jan-2025 10:57
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Sias questions Fu Yu board on controlling shareholder&rsquo s bid to remove IDs due to company&rsquo s performance
The association is also asking for the board&rsquo s opinion on whether the company&rsquo s recent upturn in financial results will continue
 
THE Securities Investors Association (Singapore), or Sias, has asked precision plastics manufacturer Fu Yu Corporation&rsquo s board to substantiate the claim by the largest shareholder Victor Lim that the company&rsquo s independent directors (IDs) should be removed due to company performance.
 
In its questions Fu Yu&rsquo s board on Thursday (Jan 16), the association noted that IDs are not typically involved with managing the company.
 
It further asked if the board has actively engaged with Lim on Fu Yu&rsquo s strategic direction, as well as whether there have been disagreements between the board and the company&rsquo s management of its strategy.
 
Fu Yu&rsquo s IDs Christopher Huang and Royston Tan had expressed surprise that Lim, who holds a 29.45 per cent stake in the company, requisitioned for an extraordinary general meeting (EGM) on Jan 9 to have them removed.
 
Huang also said that the IDs could not &ldquo in good conscience, say that it is in the best interest (of the company) for him to be admitted as an executive director&rdquo , although he did not give any specific reasons for why the board declined his bid.
 
The Business Times understands that Lim has been a director of strategy at Fu Yu since 2021, but was not on the company&rsquo s board.
 
He has called for the appointment of Gilbert Rodrigues, Ralf Pilarczyk and Yang Zhenrong as IDs to replace them.
 
&ldquo In the event the IDs are removed at the proposed EGM, who will review the suitability of the ID candidates proposed by Mr Lim, as there will be no nominating committee to assess the board candidates proposed by Mr Lim?&rdquo Sias asked.
 
Tan is currently the chairman of the board&rsquo s nominating committee.
 
This comes after Fu Yu&rsquo s board rejected Lim&rsquo s bid for a board seat on Dec 26, 2024. Sias has asked the board&rsquo s nominating committee for its reasons for rejecting his request to join the board, as well as the justifications that he presented to join the board.
 
Sias also asked for the board&rsquo s opinion on whether the company&rsquo s recent upturn in financial performance would continue. 
 
In the nine months leading up to Sep 30, 2024, Fu Yu&rsquo s revenue rose 55.2 per cent to S$162 million, while its net loss narrowed to S$1.9 million, from S$5.8 million in the prior year.
 
Local fund management firm Pilgrim Partners Asia had earlier purchased a 29.8 per cent stake in Fu Yu from the company&rsquo s co-founders and placed it in a fund in January 2021.
 
Lim became the fund&rsquo s sole shareholder on Nov 22, 2024, and opted to wind it down on Dec 11, 2024. He had also applied to join the company&rsquo s board, the company said in a clarification notice on Dec 19, 2024.
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Joelton
Supreme |
14-Jan-2025 08:50
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Fu Yu IDs &lsquo surprised&rsquo at EGM requisition by largest shareholder following his failed application to be a director 
The independent directors reiterate that they do not have any control over the day-to-day operations of the company 
 
PRECISION plastic components manufacturer Fu Yu Corporation&rsquo s independent directors (IDs) Royston Tan and Christopher Huang were surprised that substantial shareholder Victor Lim has requisitioned for an extraordinary general meeting (EGM) to have them replaced, they said on Monday (Jan 13).
 
In a bourse filing released last Thursday (Jan 9), Fu Yu : F13 0% announced that Lim had called for both Huang and Tan to be removed as directors of the company in the EGM.
 
Lim also called for the appointment of Gilbert Rodrigues, Ralf Pilarczyk and Yang Zhenrong as independent non-executive directors.
 
In his requisition notice, Lim said that substantial shareholder value had been erased since both Huang and Tan were elected to the board.
 
Tan and Huang were elected to the board as IDs on Jan 31, 2022, and Jul 19, 2021, respectively.
 
Tan, who is chairman of the board&rsquo s nominating committee, told The Business Times that the board had rejected Lim&rsquo s application to join the board on Dec 26. However, he declined to specify their reasons for doing so.
 
On Dec 19, the company issued a clarification notice about the status of Lim&rsquo s 29.8 per cent stake in the company.
 
It said that Lim, who had originally purchased a stake in the company from its co-founders in January 2021 through Pilgrim Partners Asia, had decided to wind down the fund and redeem his shares in-specie, of which he currently holds a 29.45 per cent stake.
 
In addition, the company noted that he had also applied to join the company&rsquo s board.
 
Huang added that as an ID, he would not bend to shareholder pressure, no matter how substantial their stake.
 
&ldquo We cannot, in good conscience, say that it is in the best interest (of the company) for him to be admitted as an executive director at this juncture,&rdquo he said, adding that he would leave it to the company to address why Lim was rejected.
 
Meanwhile, Tan said that he was surprised by the move to try and remove the company&rsquo s IDs for its performance, since a company&rsquo s financial performance is typically tied to the executive team&rsquo s performance.
 
&ldquo The IDs don&rsquo t get involved in the day-to-day execution of running the business. This is very, very clear,&rdquo he said.
 
He added that from a financial perspective, he felt that the company&rsquo s management team has done a &ldquo very good job&rdquo amid a difficult macroeconomic environment post-pandemic.
 
In the nine months leading up to Sep 30, 2024, the company posted a 55.2 per cent increase in revenue to S$162 million and a net loss of S$1.9 million, narrowing from a net loss of S$5.8 million a year earlier.
 
Huang said that as with any strategic reset, a company&rsquo s performance would likely follow a sort of &ldquo J curve&rdquo as its performance dips and the company recalibrates on a growth path.
 
&ldquo It&rsquo s up to the market to decide how they view the company&rsquo s trend to be,&rdquo he said.
 
In a bourse filing on Monday, Fu Yu said that the company and the board have appointed lawyers to advise on the requisition of the EGM.
 
Both the company and board also reiterated that Huang and Tan are IDs, and are not involved in the day-to-day operations of the company.
 
BT has reached out to Fu Yu to understand Lim&rsquo s role at the company, as well as the reason that he was declined a seat on the board.
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TA_Expert
Supreme |
11-Jan-2025 18:10
Yells: "The World has changed" |
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It is typically too late for the major shareholder to do something about the company when the company is facing financial difficulty or operational viability. Being the largest shareholder, he should have the vested interest by putting his own man onto the board of directors much earlier, and not relying on others.  |
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Joelton
Supreme |
10-Jan-2025 09:50
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Fu Yu' s largest shareholder, citing deteriorating performance, calls for EGM to remove half the board
 
The largest shareholder of manufacturer Fu Yu Corp is calling for an EGM to remove two out of the four company directors, citing its deteriorating performance.
 
Victor Lim Wei De, who holds 29.45% of Fu Yu shares, states in his requisition letter that the company' s earnings had dropped from $17.58 million in FY2021 to a loss of $10.11 million in FY2023. The share price has dropped from 33 cents in 2021 to 13 cents as of Jan 9. 
 
Lim wants to remove chairman Christopher Huang Junlin and another independent director Royston Tan Tong Loong, but not the other two directors, CEO David Seow Jun Hao and Daniel Poh Kai Ren.
 
All four directors were appointed to their roles in Fu Yu between 2021 and 2022.
 
In their place, Lim wants to appoint three independent directors. They are Gilbert L Rodrigues, Ralf Pilarczyk and Yang Zhenrong.
 
" A strategic reset of the company and reorganisation of the board will be required," says Lim in his requisition letter. 
 
Lim, according to Fu Yu, has been employed by the company since 2021 as director of strategy.
 
In its more recent 1HFY2024 ended June 2024, the company eked out earnings of $0.1 million, reversing from a loss of $3.9 million in the year earlier. Revenue in the same period was up 78% y-o-y to $126.7 million.
 
As indicated in its 9MFY2024 ended Sept 2024 business update, Fu Yu has improved its revenue by 55.2% to $162 million and eked out an operating profit of $0.8 million, versus an operating loss of $6.5 million.
 
According to Fu Yu' s Dec 19 filing with SGX, Lim previously held shares in the company via a fund but the fund has been wound down and Lim now holds the shares directly.
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Joelton
Supreme |
08-Nov-2024 18:04
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Fu Yu reports higher 9MFY2024 revenue, narrows net loss to $1.9 mil
Precision plastics parts maker Fu Yu Corp has recorded a net loss of $1.9 million in 9MFY2024 ended September, after including forex losses and taxation, compared to a net loss of $5.8 million in the same period last year. 
 
This came on the back of a net loss of $3 from its manufacturing division, which was partially offset by the group&rsquo s supply chain management services division&rsquo s net profit of $1.1 million.
 
Meanwhile, the group recorded an operating profit of $0.8 million for 9MFY2024, reversing from an operating loss of $6.5 million in 9MFY2023. 
 
For the same period, revenue rose by 55.2% y-o-y to $162 million, driven by higher sales across the group&rsquo s manufacturing and supply chain solutions divisions. 
 
For 3QFY2024, the group&rsquo s revenue saw a 7.6% y-o-y increase to $35.7 million, due to improved performance from Fu Yu&rsquo s manufacturing business. Contributions from the group&rsquo s Singapore and Malaysia operations grew 13.7% and 31.8%, respectively, in 9MFY2024 to $33.3 million and $27.8 million, respectively. This was partially offset by lower sales from China. 
 
Similarly, gross profit from the group&rsquo s manufacturing segment saw a 15.5% y-o-y increase to $10.6 million in 9MFY2024, while gross profit margin for the segment stood at 12.4%, up from 11.6% a year ago. 
 
For its supply chain segment, the group recorded revenue contributions of $76.4 million, up from $25 million in 9MFY2023. This came on the back of higher demand amid a global economic recovery, says the group. 
 
Gross profit margin for the segment increased to $1.5 million in the same period from $0.3 million in 9MFY2023, while gross profit margin stood at 1.9%. 
 
Group-wide gross profit rose by 27.5% to $12.1 million in 9MFY2024, while gross profit margin for the group stood at 7.5%, mainly due to a change in revenue mix.
 
Before foreign exchange, the group&rsquo s ebitda stood at $6.4 million, up from $0.1 million in 9MFY2023, due to growth in the manufacturing segment.
 
Moving forward, the group says it will continue to execute its transformation strategies to upgrade its manufacturing capabilities, move up the value chain to provide higher-precision products, and expand its customer base into new emerging industries.
 
As at Sept 30, the group&rsquo s net cash stood at $55.8 million or 7.3 cents per share. 
 
David Seow, group CEO of Fu Yu, says: &ldquo Looking ahead, we will strive to secure new customers in the biomedical sector and maintain a healthy project pipeline. In response to macroeconomic headwinds and geopolitical headwinds, we will continue to implement our strategies for long-term transformation to diversify our customer base, particularly in the biomedical industry.&rdquo
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Joelton
Supreme |
09-Sep-2024 09:17
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Fu Yu Corp doubles down on biomedical bet
Added capabilities enable it to value-add and engage new customers, as well as pursue further collaborations with existing customers
 
PRECISION plastic parts manufacturer Fu Yu Corp aims to increase sales from its biomedical segment to more than half of the group&rsquo s revenue within the next three to five years, up from the current 3 per cent, supported by the launch of its smart factory and new product design capabilities.
 
&ldquo The 3 per cent is evidence that it&rsquo s there,&rdquo said group chief executive officer David Seow. &ldquo We haven&rsquo t moved the needle yet, because for some of the capabilities that we&rsquo ve got since last year, it takes time. But the signs are there.&rdquo
 
The global biomedical devices market reportedly reached about US$600 billion in 2023, and is expected to grow 6 to 7 per cent annually, Seow said. It is &ldquo clearly a sunrise industry&rdquo , compared with Fu Yu&rsquo s other sectors, such as printing and imaging, consumer, automotive, and medical (where it produces casings), he added.
 
Biomedical equipment is harder to manufacture, making the barriers to entry and margins higher. The business is also stickier, with customers using the same product for &ldquo seven, 10, 15 years&rdquo after being trained to use them.
 
Creating capabilities
Fu Yu is planning to grow the more demanding segment with its recently opened smart factory in Tuas, which features advanced technologies, such as high-precision 3D printers.
 
The precision plastic parts producer is setting up its manufacturing execution system to enable performance monitoring, preventative maintenance, sustainability and traceability.
 
&ldquo These are the requirements that a lot of our new age, more modern customers need, because gone are the days where they just submit a purchase order, close (their) eyes, and then three months later, see whether it&rsquo s there,&rdquo said Seow.
 
Fu Yu has also been hiring talent with the technical capabilities in the biomedical field. Notably, it has established a new production introduction (NPI) team in Singapore.
 
Many medical original equipment manufacturers (OEMs) carry out research and development in Singapore, Seow said. Fu Yu&rsquo s team can engage them and propose cheaper, better materials, or those with shorter lead times, he said. It can also advise on designing for manufacturability.
 
&ldquo We used to be just a price taker&hellip just a build to print company,&rdquo he said. Its customers were those that tendered their designs and chose the lowest-cost manufacturers. &ldquo Now, our value proposition is very different because of the NPI team.&rdquo
 
OEMs are increasingly looking to outsource their design functions, as they want leaner operations, he added.
 
On top of new customers, the company is &ldquo knocking on the doors&rdquo of customers for which it is already an approved vendor, trying to go beyond making simple medical equipment case parts for them, to manufacturing high-precision parts.
 
While these customers&rsquo existing suppliers may be competition, &ldquo windows of opportunity&rdquo arise when there is a next iteration of a product, or when the previous provider underperforms.
 
Production can then be carried out in clean rooms, including in Fu Yu&rsquo s Malaysia and China facilities. 
 
Choppy contributions
Fu Yu operates six factories: one in Singapore, which functions as the &ldquo hub&rdquo , two in Malaysia and three in China, which are the &ldquo spokes&rdquo .
 
For the half year ended Jun 30, 2024, its revenue surged 78 per cent year on year to S$126.7 million, from S$71.2 million in H1 of the preceding year.
 
Of this, S$54.8 million came from the manufacturing business. Some S$72 million came from the &ldquo opportunistic&rdquo supply chain management business, where Fu Yu acts as a middleman for suppliers and buyers of commodities.
 
In the manufacturing segment, higher revenues were posted for Singapore and Malaysia &ndash up 6.6 per cent and 39.1 per cent respectively &ndash but performance in China weakened, down 20.4 per cent.
 
The consumer segment led growth in Singapore in H1 2024, but Seow expects that biomedical will be the main growth driver in future, given recent efforts.
 
Explaining the sharp improvement in the Malaysian operations, he noted that more corporations have relocated from China to Malaysia. Penang &ndash where one of Fu Yu&rsquo s facilities is located &ndash is a &ldquo very mature manufacturing hub&rdquo . The country also has relatively lower political risk in the region, while having lower costs than stable Singapore.
 
Seow also highlighted the country&rsquo s general macroeconomic recovery, with pick-ups in orders now following late 2022 and 2023&rsquo s over-inventory of medical products. The consumer segment has also been picking up.
 
But in China, the sluggish domestic economy has dragged business activity.
 
China conundrum
Beyond the uncertainty of China&rsquo s long-awaited economic recovery, the US-China tussle poses a threat. Upcoming elections in the US could also escalate trade tensions, resulting in further tariffs on China-made goods.
 
Fu Yu is taking a cautious &ldquo wait and see&rdquo approach in this market. But with the departure of international businesses, it is also pivoting to a China-for-China and China-for-Asia strategy.
 
&ldquo While we are growing our local Chinese customers, we have seen in the past that drop in orders from our international customers,&rdquo Seow said.
 
It has been courting domestic customers, but the long process leading up to final production means that the fruits of its labour have not yet been reflected in its financials.
 
He said it takes about nine months before any revenue is realised for consumer products. For biomedical products, which require regulatory checks, this can take up to two years.
 
Another headwind is supply chain problems due to the ongoing Russia-Ukraine war and the Middle East conflict. However, Seow is confident that Fu Yu&rsquo s centralised procurement in Singapore provides a global view, with opportunities to redistribute resources or seek new suppliers when shortages or freight issues occur.
 
Keeping confident
Despite some challenges, Fu Yu believes that the future is bright. The group recorded a net profit of S$72,000 in the first half of 2024, reversing from the previous year&rsquo s net loss of S$3.9 million.
 
In 2024 so far, the group managed to secure more new customers than in the year before. It has also identified India as a potential market, securing its first ever customer there recently.
 
The company has a young management team, in contrast to its founder-led industry peers that are likely to undergo leadership changes. Customers take comfort in knowing that the people they speak to now will be around for the next 15, 20, 30 years, said Seow.
 
&ldquo Before our time, there was a lot of rationalisation of factories or businesses, cutting all the loss-making factories and holding on to the profitable ones,&rdquo he added. &ldquo But they were not really growing the business. They were not improving or upgrading the capabilities.
 
&ldquo So right now we&rsquo ve done that hard work... We have a new value proposition.&rdquo
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TraderBen
Supreme |
10-May-2024 10:20
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this counter should just delist.. waste resources..
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Joelton
Supreme |
10-May-2024 10:14
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Fu Yu posts Q1 net profit of S$5,200
 
Precision plastics parts maker Fu Yu Corp has managed a turnaround for 1QYF2024, recording earnings of $5,200, versus a loss of $2.4 million in the year-earlier period.
 
Revenue in the same three months ended March was $78.9   million, double that of $36 million recorded year-earlier, as the company managed to win more contracts. 
 
Fu Yu has also announced some new key wins, including one to be the exclusive plastics supplier for a Singapore-based medical device maker.
 
&ldquo We have recorded an encouraging first quarter, as we not only reported higher revenue and a transition to a net profit from a net loss last year, but also secured promising new projects in the biomedical industry," says group CEO David Seow.
 
" These project wins reflect the early fruits of our strategic transformation," he adds.
 
According to Seow, the company is leveraging its diversified global supply chain to manage headwinds such as delayed shipment times and higher logistics costs due to the situation in the Middle East, ongoing US-China tensions, changes in the global supply chain and rising labour and energy costs. 
 
" Moving forward, we will focus our efforts on expanding our project pipeline, and executing our strategic initiatives to further our growth in the coming year," says Seow.
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Joelton
Supreme |
05-Apr-2024 10:50
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Kid-focused tech startup myFirst picks Fu Yu as exclusive contract manufacturer
 
SINGAPORE startup myFirst has appointed Fu Yu Corporation : F13 0% as its exclusive contract manufacturer, both parties said in a joint statement on Thursday (Apr 4).
 
The startup is known for its kid-safe platform that allows children to socialise using its products, which include watchphones, cameras, earbuds, 3D pens, and headphones.
 
Fu Yu, which manufactures high-precision plastic products, will provide &ldquo a full suite of solutions&rdquo to manufacture and assemble myFirst&rsquo s products, supported by its smart factory in Tuas. It will begin mass production this month for the S$15 million contract. 
 
Depending on requirements, manufacturing components for myFirst can also take place across Fu Yu&rsquo s six facilities in Singapore, Malaysia, and China.
 
The partnership will help myFirst drive the major North American expansion of its kid-safe digital platform, following a pre-Series A funding round from Lynx Asia Partners and angel investors.
 
It plans to boost its number of locations to 20,000 from 4,000, including those owned by major retailers such as Walmart, Costco, and Best Buy. It already operates in 40 countries and previously received funding in 2022 from tech founders and executives from PatSnap, Google, Rainforest, TNB Aura and Zopim.
Both parties also plan to explore using bio-rated materials to manufacture certain components to enhance sustainability across the production line.
 
MyFirst&rsquo s co-founder and chief executive G-Jay Yong said: &ldquo Every time myFirst has expanded, we have faced a sudden surge in demand. We are globally available but the US is a big market and this partnership has given us the backing to be able to cater to this demand surge.&rdquo
 
Fu Yu group chief executive and executive director David Seow added: &ldquo Over the past year, Fu Yu has been tirelessly evolving, developing new production introduction capabilities to provide early-stage engagement and enhancing our capabilities with cutting-edge manufacturing techniques.&rdquo
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Joelton
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24-Feb-2024 19:15
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Fu Yu Corp reports loss of $10.1 million for FY2023 due to expenses for smart factory development
Precision plastics manufacturer, Fu Yu Corp has reported losses of $10.1 million for its FY2023 ended Dec 31, 2023, down from FY2022&rsquo s earnings of $14.6 million.
 
This translates to a loss per share of 1.34 cents, from FY2022&rsquo s earnings per share (EPS) of 1.93 cents.
 
Meanwhile, the company&rsquo s FY2023 revenue of $190.4 million decreased by 20.7% y-o-y from $240.2 million in the year before, which it attributes to the weaker first half of 2023 amid economic uncertainty, geopolitical tensions and a higher interest rate environment. 
 
The majority of Fu Yu Corp&rsquo s incurred net loss stems from lower topline and higher labour and energy costs, expenses related to the development of its Smart Factory in Singapore, a foreign exchange (forex) loss of $0.5 million mainly due to the voluntary liquidation of its Fu Yu Moulding and Tooling subsidiary (FYSCS) in Shanghai, as well as the $2.7 million non-cash impairment of goodwill in connection with its investment in FYSCS. 
 
Gross profit also decreased by 64.6% y-o-y from $37.6 million in FY2022 to $13.3 million in FY2023
 
As such, no dividends have been recommended or declared as the company is in a loss-making position. 
 
Looking ahead, Fu Yu Corp is seeing gradual post-pandemic business recovery for tooling and plastics components across its three geographies, Singapore, Malaysia and China, particularly, in the medical and consumer sectors. It also expects momentum to build up further towards the second half of 2024. 
 
Its smart factory at 9 Tuas Drive 1 will be completed by April 2024, and will be one of Asia&rsquo s most advanced precision manufacturing facilities.
 
Despite volatility in the business environment, the company remains cautiously optimistic and expects higher contributions from its export tooling business, the bio-medical sector as well as from new customers. Together with the ongoing cost-containment efforts, and barring unforeseen circumstances, Fu Yu Corp expects the overall FY2024 financial performance to improve compared to FY2023. 
 
David Seow, CEO of Fu Yu, says: &ldquo It has been a challenging year for the manufacturers worldwide. To overcome these challenges and seize new opportunities we are implementing major initiatives to deliver sustainable long-term growth. With enhanced capabilities and maiden contributions from new revenues we expect our overall performance in FY2024 to exceed FY2023.&rdquo  
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iinvestor
Veteran |
23-Feb-2024 21:10
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1H loss -$3.8m, 2H widen loss to -$6.5m 12cts pump to 16cts now back to 13cts....no eyes see. Monday good luck. Heng never get fooled.  ![]() |
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Joelton
Supreme |
14-Dec-2023 09:58
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Fu Yu shows how articulating its plans well can revive investors&rsquo interest
FU YU Corporation&rsquo s business update at the end of November, accompanied by a media briefing on the same day, was a positive surprise for the market.
 
Under new chief executive David Seow, Fu Yu : F13 +0.75% is implementing fresh initiatives to revitalise the company. Shareholders sent the stock up 3.3 per cent that same day.
 
It closed on Wednesday (Dec 13) at S$0.134, up 8.9 per cent since the announcement, giving the company a market capitalisation of S$101.4 million.
 
The market reaction offers a playbook for small-cap companies seeking to revive investor interest in their shares. A game plan, and the willingness to talk about it, is a good place to start.
 
One of Asia&rsquo s largest manufacturers of high-precision plastic parts and moulds, Fu Yu was incorporated in 1978 and made its debut on the mainboard of the Singapore Exchange (SGX) in 1995.
 
It has been a reliable performer, generating profits even during the pandemic years and dishing out regular dividends for close to a decade.
 
Still, the company was not innovating and growing as it could have. Over the past 10 years or so, its three co-founders &ndash Ching Heng Yang, Tam Wai and Ho Nee Kit &ndash had also sought to sell their shares and retire.
 
Shares of Fu Yu traded at as high as S$1.24 in 2004 &ndash more than treble its initial public offering (IPO) price of S$0.40.
 
For most of its history as a listed company, however, the counter has traded significantly below this level, at an average of S$0.27.
 
From its IPO on Jun 14, 1995, up to the end of December 2020 &ndash just before a new investor came on board &ndash Fu Yu posted total returns of 34.2 per cent.
 
In comparison, the benchmark Straits Times Index generated total returns of 102 per cent over the same period.
 
Unveiling a new chapter
While there are many possible reasons for this undervaluation, the management&rsquo s reticence in public would not have helped.
 
Potential investors have had little opportunity to hear about &ndash and buy into &ndash Fu Yu&rsquo s growth story.
 
That may be changing. Fu Yu&rsquo s board was reconstituted in January 2021 following the sale of a 29.8 per cent stake in the company for S$58.3 million to fund management firm Pilgrim Partners Asia.
 
At a media conference explaining the company&rsquo s updated strategies, the new CEO Seow said the company needed a new direction or it would be a &ldquo sitting duck&rdquo just waiting for the market to recover.
 
Seow believes Fu Yu has not sufficiently reinvested its earnings for growth, and was focused on extracting value for shareholders instead.
 
He sees an opportunity for the company to be a market disruptor if it deploys its balance sheet well. Fu Yu had net cash of S$56.7 million as at Sep 30.
 
&ldquo Because Covid happened, there was that reconfiguration of supply chains. Suddenly, all the manufacturing lines, which (relied on) permanent relationships, were being challenged,&rdquo Seow said, adding that geopolitics has also motivated manufacturers to diversify their supply sources.
 
Seow plans for Fu Yu to focus on its core competencies in tooling by hiring talent, as well as purchasing new equipment and software. Its tools are used in moulds that produce plastic parts for its customers.
 
In an industry typically satisfied with running fully depreciated machines that are 20 to 40 years old, such investments would help distance the company from its competitors by the quality and precision of its products.
 
&ldquo If you make a great tool, your moulding is very easy because all your parts come up great with no defects,&rdquo Seow said.
 
The improvements in quality will also allow the company to produce more biomedical parts. The company aims to increase the proportion of revenue it makes from biomedical products from less than 10 per cent today to at least 50 per cent in three years.
 
Seow said the company will also be exploring mergers and acquisitions that could bring more expertise along the manufacturing process in-house, thus providing customers with a more attractive one-stop shop.
 
Manufacturing growth opportunities
Shares of Fu Yu remain distant from their historical peak, but the renewed interest in the stock is a positive sign.
 
For other small-cap stocks looking to generate similar interest in their counters, there are a few lessons to be extracted.
 
It is critical for a company to have well-thought-out plans, and equally critical for the company to have a spokesperson who can communicate these plans to analysts and the media.
 
Also, shareholders need a narrative they can follow and to which they can hold the company accountable.
 
Manufacturing may have a reputation as a staid business with limited growth opportunities, but a growth mindset in management can have a positive impact.
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arkan1111
Veteran |
05-Dec-2023 15:19
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