SHAH ALAM, 28 November 2017 – UMW Holdings Berhad’s Automotive and Equipment segments remained profitable in the third quarter of 2017 despite challenging operating conditions due to intense competition, lower margins and weaker consumer demand. In addition, the Manufacturing & Engineering segment continued to perform well as revenue climbed higher although profitability was impacted by pre-operating expenses incurred by the aerospace business. Meanwhile, the Group’s Unlisted Oil & Gas segment, consisting of companies in the process of being divested, continued to register losses.

• Group profit before taxation from Continuing Operations surged 75% higher than the corresponding period of 2016
• Automotive and Equipment segments continue to be profitable
• Manufacturing & Engineering segment achieved higher revenue but profitability was affected by pre-operating expenses incurred by the aerospace business.

• Group’s results were dragged down by losses in the Unlisted Oil & Gas and Others segments .

President and Group Chief Executive Officer of UMW Holdings Berhad, Badrul Feisal bin Abdul Rahim, said: “Despite the tough environment, the Group’s main businesses continued to deliver satisfactory revenues and profits. In particular, the Equipment segment registered 8% increase in revenue and achieved 17% higher profit before taxation compared to a year ago. Similarly, revenue of the Manufacturing & Engineering segment also grew by 8% year on year. However, losses from the Unlisted Oil & Gas segment and Others segment, adversely impacted the Group’s performance. Nonetheless, with the imminent total exit from the oil & gas sector, the Group’s future growth prospects is expected to be satisfactory.”

Overall, the Group registered revenue of RM2,671.0 million for the third quarter ended 30 September 2017, a reduction of RM136.1 million or 4.8% over the RM2,807.1 million recorded in the same quarter of 2016. Profit before taxation (PBT) from Continuing Operations rose to RM19.9 million for the current quarter as compared to RM11.4 million in the same quarter of 2016. There was no contribution from the Discontinued Operations as the demerger of UMW Oil & Gas Corporation Berhad (UMW-OG) was completed in the previous quarter.

The Automotive segment registered a revenue of RM2,115.9 million, a decline of RM147.4 million, due to lower demand for the Toyota brand in anticipation of new launches of the Innovative Multipurpose Vehicle (IMV) improvement models in October 2017. As a result of lower sales contribution, PBT dropped by RM27.4 million or 20.5% to RM106.1 million. Nevertheless, the market share for Toyota including Lexus for the first nine months of 2017 strengthened to 11.7% compared to 10.9% in the same period of 2016, and sales could be further reinforced by the launch of the new IMV models.

The Equipment segment reported revenue of RM369.3 million in the third quarter of 2017, RM26.5 million or 7.7% higher than the RM342.8 million registered in the same quarter of 2016. Malaysian operations recorded an increase in revenue of 37% and PBT of 46% for the third quarter due to higher construction activities, resulting in better performance in the equipment sales and product support. PBT for the third quarter stood at RM39.3 million, RM5.7 million or 17.0% higher than the same quarter of 2016, mainly attributable to the improved revenue contribution.

The Manufacturing & Engineering segment reported an improved revenue of RM155.8 million in the third quarter of 2017 compared with RM144.6 million in the same quarter of 2016, supported in part by positive contributions from the auto components manufacturing business. However, the segment registered a loss before taxation of RM6.7 million compared with a PBT of RM2.5 million in the corresponding quarter of 2016 as profitability was affected by pre-operating expenses incurred for the aerospace business of RM42.3 million. The adverse impact is expected to diminish as the fan case plant commences full commercial operations.

Badrul Feisal added: “The Group’s overall performance is expected to remain challenging in the final quarter of the year. As announced earlier, we are committed to exit the unlisted oil & gas segment by 2018 and upon completion of the strategic plans of exiting the unlisted oil & gas assets, the Group is better positioned to focus on the next phase of growth of the three core businesses, Automotive, Equipment and Manufacturing & Engineering.”