Interest income and fx gain are recurring yearly. Interest income will parallel the increase in cash. For the past 6 years FPI’s PBT has consistently been higher than OP.
Also, in-spite of the high cash reserve RoE is more than 20%. It simply means FPI's capital expenditure requirements are low.

Export of Sony products will be record high in Q1.

https://www.importgenius.com/suppliers/formosa-prosonic-ind-berhad

My best guess based on limited US import data:-
- Last Sony shipment was on Aug,'22. It was also the biggest export qtr of Sony speakers. Q4, '22 inventory went down due to Sony inventory clearance
- Revenue attributed to Yamaha guitar amplifier is slightly more than half of Sony revenue. But I believe margin should be higher as guitar amplifier is a niche product.
If forex gain/loss is excluded, Q3,'22 was not that great, and Q4,'22 was not bad. Briefly, EPS excluding forex gain/loss and one-off prosperity tax were:-
Q4 = 8.6cents
Q3 = 10.2
Q2 = 7.7
Q1 = 6.7
In fact Q4 was better than Q2 and Q1. Anyway with PE=6, there is limited downside.
Exclusion - I'm still learning and could be wrong. Please double-check what I mentioned above and inform me if I'm wrong.

Two different things:-
1. Wistron has 27% share of FPI
2. Wistron contribute 10.5% revenue to FPI

You can find US import data below:
https://www.seair.co.in/us-import/e-formosa-prosonic-industries-bhd.aspx
The import data gives a very rough estimation, as it only provide information on US import and not other countries.
To get updated and not 1-2 months delayed data, you will need to purchase the service.

3.19

You are right. FPI export to a lot of other countries too. Unfortunately I do not have that data. As such my view is narrow and limited to just US import only.
Anyway, overall I think FPI is a well run company.

donald770, as most value stocks it is difficult to predict the price movement in the short term. If you have a long term view, I think it is a good buy. But please do your own research as I could be wrong. Anyway the pros and cons below:-
Pros:
- Wistron as a 27% stake. It would assist the company and will not let it go under. This can be viewed as a moat.
- Very low valuation with PE < 7. A lot lower if you minus net cash from price
- Conservative management (conserve cash, do not take unnecessary risk or diversify unnecesarily, etc.)
- Low CAPEX , yearly equipment expenses are low
- High ROIC >20%. A lot higher if you minus cash
- Consistent Revenue, FCF, Earning, and Equity growth the past 7 years (>10% per year)
- Uninterrupted dividend payment for more than 20 years (perhaps 30 years)
- Net cash position >300M (43% of market cap)

Cons:-
- Customer concentration - only 3 main customers that contribute more than 10% revenue.
- Low CAPEX (not a huge moat, competitor might encroach easily)
- Conservative management (reluctant to buyback share even at this low valuation and only one time dividend payment)
- Yamaha is replacing Sony as one of the big customers. Not sure Yamaha can provide the same size revenue. My information is based on US import data. I could be wrong here.
- Q1 '23 might not be great (subsequent quarters will be better - I think but could be wrong)

It is actually good news as Wistron price has more than doubled the past 6 months - from 26.8 TWD last November to 49.55 TWD today. The plant was sold to Tata for more than USD$600M.

No one expected 13M forex loss. Really disappointing Q4 results.
Some good news:
1. Cash and cash equivalent up 36% to 361M from 265M in year 2021
2. Earning up 9%, revenue up 4.8% on yearly basis

The easy and very conservative way to calculate the intrinsic value is to look at the gap between the current PE and average PE the past 5 years.
PE in the past has been around 10. Intrinsic value is (Past PE) * (Current Price)/ (Current PE) = 10 *3.53 / 7.18 = RM4.9. Anyway, we hope reversion to the mean happens soon.
As FPI is a growth company, I believe the above calculation is too conservative. The actual PE should be much higher than 12x. This PE can only be achieved if share buy-back is initiated or institutional investor put FPI in their radar.

I think it does not matter much, revenue from Wistron is small compared to other 3 customers

Difficult to say. Historically, Q3 numbers are the highest. However, I expect 2022 revenue to be significantly higher than 2021.

I could be wrong but I think FPI have 4 major customers:-
1. Wistron
2. Sony
3. Roland
4. Yamaha - This is a new customer and will drive 2023 revenue growth

A few quick notes:-
1. FPI management has always been very conservative in their projection and disclosure. FPI's Earning, Dividend, FCF and Revenue has been growing at a CAGR above 20% (/ year) the past 7 years. The management never projected the growth in any previous AGMs or reports. It is up to you to decide if this is good or bad.
2. With current low PE valuation, there is little downside risk and significant upside potential. You get future growth free of charge. PE < 8 simply means no future earning growth projection is included at current price.
3. FPI's Year 2022 Revenue, Dividend, FCF and Earning is expected to be at least 18% higher than year 2021 even if you assume Q4 results are the same as Q4,2021.

A quick note on PE - do you remove FX gain from earning? Do you remove net cash from market cap? Each to his own. If you remove net cash from market cap, PE is less than 4.5.
So we are looking at a PE range between 4.5 to 10 - all depends how you want to cut it.

A few comments on FX gain:-
1. Assuming earning for Q4,2022 is the same as Q4, 2021, 2022 will be a record year even if FX gain is stripped away. Just remember to strip the FX gain of previous years too. It is not a one-off item. Also remember FX gain shown in financial report is pre-tax
2. Will there be the same amount of FX gain this year if MYR hovers around the same range? It is anyone's guess.
3. Even if FX gain is a one-off item (which it is not), the potential FX gain for 2022 was above 20M, around 2.3% of market-cap. This amount can be used for dividend payout, share buy-back or CAPEX. End of the day the shareholder benefit.

@ Thirai Thiraviam, OCF in Q3 2022 was RM62m. Total Cash and cash equivalent at end of Q3, 2022 was RM292m compared with Q3,2021 which was RM214m. I expect total cash to exceed RM320m for year 2022 based on conservative estimate - Q3 net change in working capital was (RM33m).

My Letter to the board: hope more long term shareholders can follow suit and convince the board to initiate share buyback.
"Dear Sir/Madam,
I'm a heavy investor in FPI and would like to increase my investment.
The past few years FPI has shown phenomenal earning and cash flow growth.
Most of it can be attributed to good management. However, there are concerns among shareholders that the share price has not moved up in tandem. ESOS exercise has not been kind to shareholders - most employees and management are immediately exercising their ESOS options once it is made available.

With a PE ratio of 6.6, FPI is hugely undervalued.
I would like to request the board to initiate immediate share buyback. Share buyback is only recommended if the share price is irrationally low.
"Irrational undervaluation as dramatic as this is often a short-term anomaly. The timing for buyback is still ripe but the opportunity will not last forever."
"With such an enormous valuation gap and such a massive amount of cash on the balance sheet", we hope the board (who does not appear to have much skin in the game) will move aggressively to buy-back FPI shares.

I sincerely pray the board will accept my recommendation in the spirit it is given - not specifically to increase the share price but to add more value to the loyal shareholders.

Your Faithfully
........................... "

With a PE ratio of 6.6, FPI is currently hugely undervalued. "Irrational undervaluation as dramatic as this is often a short-term anomaly. The timing for buyback is still ripe but the opportunity will not last forever."
"With such an enormous valuation gap and such a massive amount of cash on the balance sheet", we hope the board (who does not appear to have much skin in the game) will move aggressively to buy-back FPI share and add more value to shareholder.

Company current valuation is very low, if you remove 270M cash from market cap, we will be looking at PE of 5.3x. Hope management will initiate share buyback now when the price is really depressed. It will offset the ESOS plan awarded last year and add more value to long-term shareholder compared to dividend payout.

On top and above a record quarter profit by a wide margin, year to date ended 30 June 2022 - recorded higher revenue of RM503.2M, an increase of 14% from the previous year's corresponding period.

Ghochu: Thanks for the info, you are right on both accounts:
1. At times it is better to strip exceptional gain and expense when calculating forward earning. Please note there was also a 6M expense for stock option
2. Though FPI is cash rich, BoD might not follow through on the share buy-back proposal

The PE of 8.64 is not forward looking but rather TTM!

The share buyback proposal that the board of directors are proposing for the AGM could not have come at a better time. Many glove companies had share buy back program last year to prop the already high value of their stocks. It did not work as intended as the stock were way overpriced then. But the proposal by FPI last Friday is different and shows the BoD prudence in using the company's cash. Buyback program should only be initiated when the share price is really low and way below its intrinsic value. With a PE of 8 and expected revenue and earning growth of at least 20% per year for the next few years, it will be difficult to find a more opportune time.

Actually you do not even need a big shark. Company has ~220M cash. A buy-back program will create a huge price uptrend

CAPEX expenditure for 2021 is ~23M which is a good news indicating FPI is expected to grow.

There is very significant yoy upwards earning momentum.
Not sure why it is priced so cheap - even if we assume it falls under consumer category and not EMS. Perhaps it is due to ESOS.
Anyway value investor follow the earning and mis-priced stocks like this provides good opportunity.
Sony and Yamaha are direct customer and are not going through Wistron. There is no analyst report perhaps due to small market cap below 1B. Anyway most analyst report are not worth the paper they are printed on.

RoIC=RoE >20% and zero debt. Company is utilizing its capital efficiently.

I believe there are four major customers A. Sony, B. Wistron, C. ?.., D. Yamaha (new customer)

Quite a few MNCs are moving out of China, and are looking at SEA countries to fill the gap. I expect FPI growth will be higher than industry average of 19.1%

@ghochu "The global bluetooth speaker market reached a value of US$ 10.1 Billion in 2021. Looking forward, the publisher expects the market to reach US$ 30.4 Billion by 2027, exhibiting a CAGR of 19.1% during 2022-2027."
https://www.prnewswire.com/news-releases/global-bluetooth-speaker-market-2022-to-2027---industry-trends-share-size-growth-opportunity-and-forecasts-301490007.html

FPI eps and revenue have been growing more than 20% per year for the past 5 years. Assuming the same growth rate next 5 years, my TP is based on PE reaching 16-18.

@Thirai Thiraviam. ~7.9M ESOS shares has been issued. Remaining 5.6M.