Sime Darby net profit more than doubles in Q2

Earnings improve on Tesco stake sale, motors division

“We have been fortunate that demand for luxury cars has remained relatively robust during this period.” Datuk Jeffri Salim Davidson

KUALA LUMPUR: Sime Darby Bhd posted a net profit of Rm633mil in the second quarter ended Dec 31, 2020, more than double the net profit of Rm282mil in the previous corresponding quarter, due to a stake sale in Tesco Malaysia and improved contribution from its motors division.

Excluding the net gain of Rm272mil from the sale of its 30% interest in Tesco Malaysia, the group’s net profit in the quarter was 28% higher year-on-year (y-o-y).

“Our motors division has been a standout performer in the second quarter of financial year 2021 (FY21), almost doubling its profit thanks to the outstanding contribution from our operations in China.

“Motors Australia’s performance was also noteworthy given our turnaround of the Sydney dealerships, which we acquired in 2019. We have been fortunate that demand for luxury cars has remained relatively robust during this period,” said group CEO Datuk Jeffri Salim Davidson in a statement.

Profit before interest and tax surged 88.6% y-o-y to Rm843mil.

Revenue, meanwhile, was up 10.1% to Rm11.24bil from Rm10.21bil in the comparative quarter of the previous year.

The board has declared an interim dividend of two sen per share and a special dividend of four sen per share.

Over the two quarters of FY21, Sime Darby recorded a 73.1% jump in net profit to Rm914mil from Rm528mil in the same period in 2019.

Revenue for the six months was Rm22.1bil, 12.4% higher than the Rm19.7bil achieved in the first half of FY20.

Sime Darby said it is well-positioned to ride the wave of demand for luxury cars but is mindful of the risks from the ongoing Covid19

pandemic as well as the slowing demand at its coal mining segment in Australia due to coal import restrictions by China.

Meanwhile, Sime Darby Property Bhd is looking at a higher sales target of Rm2.4bil for 2021, off the back of a target-beating sales performance in 2020.

In 2021, Sime Darby Property will launch projects with a gross development value of about Rm2.5bil, which will include a product mix of both landed and high-rise residentials, as well as industrial and commercial offerings, it said in a statement.

The group achieved total sales of Rm2bil in 2020, 43% higher than the revised sales target of Rm1.4bil.