DRB-Hicom posts RM309m net loss in Q2

PETALING JAYA: DRB-Hicom Bhd swung to the red registering a net loss of RM309.63 million for the second quarter ended Sept 30, 2016 versus a net profit of RM3.9 million in the last corresponding period, dragged down by weak performance in the automotive and defence sectors, unrealised forex losses and a one-off exceptional loss on re-measurement of previously held equity interest in Pos Malaysia Bhd.

Revenue for the quarter under review fell 18.7% from RM3.25 billion to RM2.64 billion.

In a filing with the stock exchange, the group said the re-measurement loss of RM130 million arising from its stake in Pos Malaysia was in accordance with Financial Reporting Standard 3 on Business Combinations.

It noted that the unrealised forex losses, arising from the re-translation of certain payables and borrowings denominated in foreign currencies, was due to the recent adverse foreign currency movements.

Meanwhile, DRB-Hicom said the decline in total industry volume by 13.8% in the nine months of 2016 has impacted the performance of the automotive industry.

Nonetheless, the group said it is positive on its search for a foreign strategic partner for its automotive arm Proton Holdings Bhd, with now arriving at a shortlist of three global automotive companies.

DRB-Hicom expects Proton’s performance to improve on the back of the successful launch of its four new models.

“Cost management efforts along with operational efficiency initiatives remain in place as the group moves to improve its performance,” it said.