- Group profit before taxation from Continuing Operations increased by 6% compared with the corresponding period of 2017

- Automotive segment’s profit before taxation rose by 45%

- Equipment segment’s revenue increased by 9% while profit before taxation grew 14%

- Manufacturing & Engineering segment achieved marginally higher revenue but profitability was impacted by operating expenses incurred by the aerospace business 
 

Core Business Segment	Automotive	Equipment	M&E	Total
PBT (RM'mil)	125.9	44.9	(2.9)	167.9

KUALA LUMPUR,  May 22 (Bernama) -- UMW Holdings Berhad’s Automotive and Equipment segments remained profitable in the first quarter of 2018 despite the challenging operating conditions.  Furthermore, both the Equipment and Manufacturing & Engineering (M&E) segments achieved higher revenue compared with the first quarter of 2017.  However, the M&E segment registered a loss due to higher operating expenses incurred by the aerospace business as compared to 2017.

UMW Holdings Berhad President & Group CEO Badrul Feisal bin Abdul Rahim, said: “The Group continued to register healthy results despite challenging economic and operating circumstances.  Although the Automotive segment faced intense competition and strict lending guidelines enforced by financial institutions, its profit before taxation (PBT) surged 45%.  In addition, the Equipment segment registered 9% increase in revenue and achieved 14% higher PBT compared to a year ago.  Similarly, revenue of the Manufacturing & Engineering segment also grew by 2% year-on-year.  Subsequent to the result, we have declared an interim single-tier dividend of 5.0 sen per share. 

Following the exit from the listed oil & gas segment, the Group is now well-positioned with improved earnings visibility and growth.   Moving forward, we are confident of the long-term prospect of our three core businesses as demonstrated by our on-going investments in Automotive, Equipment and Manufacturing and Engineering businesses.  Our growth strategy will be underpinned by continued expansion in these three core segments to deliver value to our shareholders.”

Overall, the Group registered revenue of RM2,415.3 million from Continuing Operations for the first quarter ended 31 March 2018, a decrease of RM279.9 million or 10% over the RM2,695.2 million recorded in the same quarter of 2017.  The Group posted a PBT from Continuing Operations of RM147.3 million for the first quarter, 6% higher than the PBT of RM138.9 million in the previous corresponding quarter.  The improved performance was primarily driven by the Automotive segment.  The Group posted a loss before taxation from Discontinued Operations of RM23.7 million, substantially lower than the loss of RM124.5 million registered in the same period of 2017.  The operations in the Oil & Gas (unlisted) segment have been scaled down while the management is actively executing the divestment strategy.  For the first quarter of 2018, the Group’s net profit surged to RM74.1 million compared to RM20.2 million recorded in the first quarter of 2017. 

The Automotive segment reported a revenue of RM1,877.1 million in the first quarter of the year, 14% lower than the RM2,190.9 million registered in the previous corresponding quarter.  Sales performance was weighed down by shortfall in the passenger car segment, evidenced by the decline in sales volume.  Despite the lower revenue contribution, PBT improved from RM87.1 million to RM125.9 million in the current quarter, mainly contributed by better performance from associate company and improved profit margin as Ringgit remained strong against the US Dollar. 

The Equipment segment registered revenue of RM373.0 million in the first quarter of 2018, higher than the RM342.4 million reported in the previous corresponding quarter.  The performance of the heavy equipment business was lifted by higher export sales of Komatsu equipment whilst the industrial equipment was bolstered by a major customer order on renewal of the entire fleet of older equipment.  The segment registered a PBT of RM44.9 million for the first quarter of 2018, 14% higher than the previous corresponding quarter of RM39.5 million as a result of the improved revenue.   

The M&E segment reported marginally higher revenue of RM168.5 million as compared to RM165.9 million in the same quarter of 2017, contributed by higher revenue in auto components business and revenue generated by the aerospace business.  The revenue-generating aerospace business remains at operating loss due to high operating expenses incurred as compared to 2017.  Consequently, the M&E segment registered a loss before taxation of RM2.9 million as compared to a PBT of RM3.1 million in the first quarter of 2017.

The company has declared a single-tier dividend of 5.0 sen per share (2017 – nil), amounting to a net dividend payable of approximately RM58.4 million (2017 – nil) for the financial year ending 31 December 2018, to be paid on 21 June 2018 to shareholders whose name appears in the Record of Depositors at the close of business on 6 June 2018.

Moving forward, the Group expects the Automotive segment to remain challenging with continuation of strict lending guidelines and weaker consumer demand. In the Equipment segment, the heavy equipment is expected to perform satisfactorily due to higher demand arising from the anticipated growth in the construction sector.  The industrial equipment within the Equipment segment is also projected for a strong growth with improved demand in Malaysia, Singapore and Vietnam.  In the M&E segment, sustained demand for auto components and lubricants is forecast to contribute to better results.  Furthermore, the aerospace business is currently in the ramp-up stage to the deliver the can cases as per contractual requirement.      

About UMW

The UMW Group is an international conglomerate that develops industries, manages partnerships and facilitates growth. It is involved in three core businesses – Automotive, Equipment and Manufacturing & Engineering.  It operates in 10 countries and has close to 9,000 employees.

Adopting its rallying call – Beyond Boundaries®, UMW is set to play a leading role in shaping the future of its industries globally. The Company will do this by inspiring vibrant ideas, nurturing potential, pioneering partnerships and delivering excellence in everything it does; the rewards of which will contribute to the progress and well-being of all its stakeholders.

SOURCE : UMW Corporation Sdn. Bhd.
 
FOR MORE INFORMATION, PLEASE CONTACT: 
Name : S Vikneshwaran
Head - Investor, Media Relations & Sustainability
UMW Corporation Sdn. Bhd.
Tel : +603 2025 2104 / +6019 850 5799
Email : vikneshwaran.s@umw.com.my

--BERNAMA