The Star Malaysia - StarBiz

UMW expects momentum to continue

Improved demand to drive growth

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“The group remains cautious about the potential downside of both external and domestic market forces.”

Datuk Ahmad Fuaad Kenali

KUALA LUMPUR: UMW Holdings Bhd posted a net profit of Rm100.7mil in the third quarter, ended Sept 30, 2022 (3Q22), and expects the positive earnings momentum to continue into the final quarter.

President and group chief executive officer Datuk Ahmad Fuaad Kenali said the group is encouraged by the improved results achieved in 3Q22, following an economic recovery under the National Recovery Plan (NRP).

“The group expects the momentum to continue in the final quarter of 2022, based on outstandin­g orders, as well as an improving demand for products and services.

“However, the group remains cautious about the potential downside of both external and domestic market forces and will continue to improve its resilience by focusing on cost optimisati­on and operationa­l efficiency, while engaging with its principals, suppliers and stakeholde­rs to mitigate the challenges,” he said.

“Overall, the group expects the performanc­e for the remainder of 2022 to be better than the previous year.”

UMW Holdings posted a net profit of Rm100.7mil for 3Q22, compared with a net loss of Rm47.9mil in 3Q21.

Supported by the improved contributi­on from all three core business segments, group revenue in 3Q22 rose by more than 100% to Rm4.06bil against Rm2.02bil a year ago, signalling a strong recovery towards the pre-covid-19 levels.

Earnings per share at 8.62 sen, compared with a loss per share of 4.10 sen previously.

The group’s improved performanc­e was mainly attributed to the economic recovery under the NRP as opposed to the full movement control order implemente­d from June 1, 2021 to August 15, 2021, as well as the transition into the endemic phase of Covid-19.

For the nine months, net profit surged to Rm309.1mil against Rm28.3mil in the previous similar period in 2021.

In view of the encouragin­g performanc­e, UMW has declared an interim dividend of three sen per share, amounting to Rm35mil for the financial year ending Dec 31, 2022, to be paid on Dec 15, 2022.

On the automotive front, the segment’s revenue more than doubled to Rm3.43bil, compared with the correspond­ing quarter, supported by the higher number of vehicles sold, which was driven by the sales tax exemption and the introducti­on of new models.

In line with the higher revenue and share of profit from an associated company, the segment’s profit before taxation and zakat surged to Rm183.6mil.

The automotive segment is expected to continue to benefit from the sales tax exemption for outstandin­g orders made before June 30, 2022 and to be registered by March 31, 2023.

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