Sime Darby ends 3Q on a high note

PETALING JAYA: Sime Darby Bhd’s industrial business continues to drive the group’s performance, while UMW Holdings Bhd’s contribution helped to boost the bottomline.

In a filing with Bursa Malaysia yesterday, Sime Darby said it recorded a net profit of RM340mil in the third quarter ended March 31, 2024, up from RM240mil in the year-ago quarter. This translates to an earnings per share of five sen from 3.5 sen previously.

The group reported revenue of RM18.84bil against RM11.53bil in the comparative quarter.

In a statement, Sime Darby group chief executive officer Datuk Jeffri Salim Davidson said the company ended the quarter on a high note, with the industrial division continuing to be the key driver, leveraging strong prospects in the mining sector, particularly in Australasia.

“This goes to show that the mining business in Australia is still very strong and continues to be profitable.

“This quarter also marked the UMW division’s first full quarter contribution to the group. Moving forward, the integration of UMW into Sime Darby will remain a key priority,” he said.

Jeffri Salim added that the group’s strong performance is a testament to the hard work and collaborative spirit of Sime Darby’s teams across its industrial, motors and UMW divisions.

“With their continued dedication, we are well-positioned to unlock new growth opportunities and deliver sustained value for our stakeholders.”

For the nine-month period ended March 31, 2024, Sime Darby posted a net profit of RM3.22bil compared to RM836mil a year earlier, largely attributed to the RM2bil gain on the disposal of Ramsay Sime Darby Health Care. Revenue during the nine-month period rose to RM48.34bil from RM35bil in the previous corresponding period.

Sime Darby said the group’s results for the three quarters ended March 31, 2024 were mainly contributed by strong results from Industrial Australia, Motors Malaysia and the recently acquired UMW.

“However, the group continues to face challenging business conditions in China, and cost inflationary pressures and continued high interest rates, particularly in Australasia.”

Sime Darby said its industrial operations in Australia continue to be supported by demand from the mining sector and profit contribution from the recent acquisitions (Onsite and Cavpower).

“Operations in China are expected to remain subdued in the near term.”

Meanwhile, demand for motor vehicles in Malaysia is expected to moderate in the second half of 2024 in view of the expected fuel subsidy rationalisation and high value goods tax.

“The business conditions in China remain challenging with intense competition and heavy discounting by automotive companies. The UMW operations have contributed strongly to the group in the first full quarter results since its acquisition and are expected to continue contributing positively in the current financial year,” it said.