SHAH ALAM, 28 August 2017 – UMW Holdings Berhad’s core businesses – Automotive, Equipment and Manufacturing & Engineering – have remained profitable in the first quarter of 2017 despite exceptionally difficult and challenging operating conditions due to heightened competition, a weak ringgit and subdued consumer demand. Only the Group’s listed and unlisted Oil & Gas segments, which are in the process of being divested, recorded losses for the quarter.

• Automotive, Equipment and Manufacturing & Engineering segments continue to be profitable despite intense competition, subdued consumer demand and weak ringgit

• Group’s lower profit before tax due to higher losses in Listed Oil & Gas segment
• Oil & Gas exit will improve financial position and refocus on core businesses.

President and Group Chief Executive Officer of UMW Holdings Berhad, Badrul Feisal bin Abdul Rahim, said: “The Group continued to demonstrate the mettle and resilience of its core businesses to record sustained revenue and profit growth despite challenging economic and operating circumstances.” The Group’s overall financial performance proved resilient despite challenging conditions which affected all industry players. With the Group’s strategic decision to exit the O&G sector, UMW Holdings’ future prospects have been enhanced with its financial position and performance expected to improve moving forward.

Overall, the Group registered revenue of RM2,803.6 million for the first quarter of 2017, which was 27.5% higher than the corresponding quarter in 2016. Profit before tax (PBT) for the Group in the first quarter of 2017 was RM14.4 million, a decrease of 31.7% compared to PBT of RM21.1 million in the corresponding quarter, mainly due to the higher losses in its Listed Oil & Gas segment. For the first quarter of 2017, the Group’s core businesses – Automotive, Equipment and Manufacturing & Engineering – posted a combined PBT of RM129.7 million as compared to RM128.6 million in the corresponding quarter of 2016. For the quarter, the core businesses registered revenue of RM2.7 billion, an improvement of 28.6% compared to revenue of RM2.1 billion in the corresponding quarter last year.

The Automotive segment recorded revenue of RM2,190.9 million for the first quarter of 2017, an increase of 40.8% compared to the corresponding quarter in 2016. PBT for the quarter improved by 5.2% to RM87.1 million compared to RM82.7 million in the corresponding quarter last year. With spill-over orders from year-end promotions boosting consumer sentiment, improved sales translated to higher market share for Toyota from 8.0% in the first quarter of 2016 to 11.8% in the quarter under review. As a result of the competitive local operating environment, the Equipment segment registered marginally lower revenue of RM342.4 million compared to RM358.0 million in the same quarter of 2016. PBT for the segment improved marginally to RM39.5 million from RM39.2 million in the corresponding quarter of 2016.

The Manufacturing & Engineering segment recorded revenue of RM165.9 million, an improvement of 14.1% over the same quarter in 2016. Due to the operating expenses incurred by the segment in setting up its new aerospace unit, PBT decreased to RM3.1 million for the quarter under review compared to RM6.6 million in the same quarter of 2016.

Badrul Feisal explained: “The Group’s overall performance remains robust, as demonstrated by the sustained profitability of its core businesses under challenging operating circumstances. Furthermore, the recent strategic decisions and plans the Group have made will be the springboard for our future growth.” “At the Group’s recent EGM, our shareholders gave us an overwhelming mandate to proceed with the demerger of UMW Oil & Gas Corporation Berhad. This strong vote of confidence will allow us to refocus on our core businesses, particularly in view of the attractive long-term growth prospects across these three segments.” “Moving forward, not only will the Group’s earnings and profitability stabilise, our improved financial position and flexibility will allow us to optimise resources and embark on investments in these core areas of businesses as the platform for future expansion and value creation.”