Hello fellow investors and market watchers!
Today, we’re diving into the latest financial pulse of FAVELLE FAVCO BHD, a prominent name in the global heavy lifting equipment and intelligent automation sectors. The company recently released its unaudited results for the Second Quarter ended 30 June 2025, and there’s certainly a lot to unpack. The headline? A robust increase in revenue and profits, reflecting strong operational performance, even as the global market navigates various challenges. Let’s dig deeper into what this report tells us about FAVELLE FAVCO’s journey.
FAVELLE FAVCO: A Strong Performance in Q2 2025
Overall Financial Highlights
FAVELLE FAVCO has reported an impressive performance for the second quarter of 2025, demonstrating healthy growth across its key financial metrics. Both the quarterly and year-to-date figures paint a picture of resilience and strategic execution amidst a dynamic market landscape.
Second Quarter (Q2 2025 vs Q2 2024)
Revenue: RM230.16 million
Profit Before Tax (PBT): RM20.42 million
Profit for the Period: RM11.68 million
Basic Earnings Per Share: 3.50 sen
Revenue: RM203.06 million
Profit Before Tax (PBT): RM13.92 million
Profit for the Period: RM8.60 million
Basic Earnings Per Share: 2.79 sen
The company saw its revenue climb by a solid 13.35% to RM230.16 million in Q2 2025, up from RM203.06 million in the same period last year. This translated into a significant surge in profitability, with Profit Before Tax (PBT) rocketing by an impressive 46.65% to RM20.42 million. Net profit for the period also jumped 35.87% to RM11.68 million, pushing Basic Earnings Per Share (EPS) up by 25.45% to 3.50 sen.
Year-to-Date (YTD Q2 2025 vs YTD Q2 2024)
Revenue: RM405.49 million
Profit Before Tax (PBT): RM39.03 million
Profit for the Period: RM26.25 million
Basic Earnings Per Share: 8.87 sen
Revenue: RM379.50 million
Profit Before Tax (PBT): RM32.90 million
Profit for the Period: RM22.65 million
Basic Earnings Per Share: 7.94 sen
For the first six months of 2025, FAVELLE FAVCO’s consolidated revenue grew by 6.85% to RM405.49 million, compared to RM379.50 million in the corresponding period last year. This consistent growth trajectory is further reflected in the YTD PBT, which saw an 18.64% increase to RM39.03 million, and a net profit of RM26.25 million, up 15.85%. Basic EPS for the period rose by 11.71% to 8.87 sen. The report attributes this uplift mainly to an increase in sales, a clear indicator of robust demand for the Group’s offerings.
Did You Know? The effective tax rate for the Group was higher than the local statutory rate mainly due to certain expenses not being deductible for tax purposes and an additional balancing charge from the disposal of fixed assets.
Segmental Performance: Cranes and Intelligent Automation Drive Growth
FAVELLE FAVCO operates primarily through two key business segments: Intelligent Cranes and Intelligent Automation. Both segments contributed positively to the Group’s overall performance in the first half of 2025.
| Segment | Revenue (YTD Q2 2025, RM’000) | PBT (YTD Q2 2025, RM’000) |
|---|---|---|
| Intelligent Cranes | 307,431 | 36,665 |
| Intelligent Automation | 98,059 | 2,369 |
| Consolidated Total | 405,490 | 39,034 |
The Intelligent Cranes segment, which includes revenue from both Malaysian and international markets (RM141.26 million and RM166.18 million respectively), remains the primary revenue driver. Meanwhile, the Intelligent Automation segment, with RM98.06 million in revenue (entirely from Malaysia), continues to grow and diversify the Group’s income streams.
Financial Health Check: Strong Balance Sheet and Cash Flow
Looking at the balance sheet as of 30 June 2025, FAVELLE FAVCO maintains a healthy financial position:
- Total Assets stood at RM1.44 billion, slightly up from RM1.44 billion at 31 December 2024.
- Total Equity attributable to owners increased to RM788.34 million from RM782.53 million, reflecting the period’s profits.
- Net Assets Per Share (attributable to owners) improved to RM3.35 as of 30 June 2025, compared to RM3.33 at the end of 2024.
- Perhaps most notably, Cash and Cash Equivalents surged to RM200.48 million from RM161.17 million at the end of 2024, and significantly up from RM153.48 million a year ago.
The cash flow statement further reinforces this positive trend. The Group generated a robust RM47.93 million in net cash from operating activities for the first six months of 2025, a stark and highly positive reversal from the net cash used in operating activities of RM24.34 million in the same period last year. This demonstrates exceptional operational efficiency and liquidity management.
Navigating Challenges and Seizing Opportunities: Risks and Prospects
While the operating environment remains challenging, FAVELLE FAVCO is strategically positioned to capitalize on emerging opportunities.
Solid Order Book and Market Outlook
A key indicator of future revenue is the Group’s outstanding order book, which stood at approximately RM604 million as of 20 August 2025. This includes a significant contribution of RM126 million from the Intelligent Automation segment. This substantial order book provides a strong revenue pipeline and reflects continued demand for its products and services across various industries, including:
- The global oil and gas sector, which remains stable, supporting stable investment levels.
- Rising construction activity, particularly in the Middle Eastern countries.
- Shipyard modernization and expansion, including replacing aging equipment.
- The burgeoning wind turbine industry.
The company expresses optimism for an increase in orders moving forward, citing these trends. Their focus on diversified industries helps mitigate risks associated with reliance on a single sector, even within a “challenging outlook.”
Employee Share Issuance Scheme (SIS)
During the quarter, FAVELLE FAVCO issued 15,000 new ordinary shares at RM1.45 each under its Employees’ Share Issuance Scheme. This indicates ongoing commitment to employee incentivization and retention, aligning employee interests with shareholder value.
Note: The Directors did not declare any interim dividend for the financial quarter under review. This is not uncommon for companies prioritizing reinvestment for growth or capital preservation during periods of market volatility or strategic expansion.
Summary and Investment Recommendations
FAVELLE FAVCO BHD has delivered a compelling second-quarter performance, marked by significant revenue and profit growth, a strengthening balance sheet, and a notable turnaround in operating cash flow. The substantial outstanding order book positions the company favorably for continued growth in the coming periods, leveraging opportunities in the global oil & gas, construction, shipbuilding, and renewable energy sectors.
Key factors influencing FAVELLE FAVCO’s future trajectory include:
- The successful execution and delivery of its substantial RM604 million outstanding order book.
- Continued stability and growth in global oil & gas investments.
- The pace of infrastructure development and shipyard modernization, particularly in the Middle East.
- Further expansion into and innovation within the intelligent automation and wind turbine industries.
- Effective management of operating costs and supply chain dynamics in a potentially volatile global economy.
While the market outlook presents its own set of challenges, FAVELLE FAVCO’s strategic focus on diverse, high-growth industries and its solid financial footing suggest a company poised for ongoing positive momentum. Investors will be keenly watching how these strategic initiatives translate into sustained financial performance.
What are your thoughts on FAVELLE FAVCO’s latest results? Do you believe the company can maintain this growth momentum and successfully navigate the global market dynamics in the coming quarters? Share your perspectives in the comments below!
Stay tuned for more analyses on Malaysian companies!
