Shah Alam, 24 Feb 2012 – The UMW Group announced today that its Group revenue of RM3,477.3 million for the fourth quarter ended 31 December 2011 exceeded the RM3,417.7 million recorded in the preceding year’s corresponding quarter by 2%. Higher revenue was recorded from the Equipment, Manufacturing & Engineering and Oil & Gas segments.
Group profit before taxation of RM315.6 million for the fourth quarter ended 31 December improved from the RM224.9 million registered in the same quarter of 2010. This represented an increase of 40.3% or RM90.7 million. Substantially higher profit contributions from the Automotive segment accounted for the rise in profit.
Consequently, net profit attributable to equity holders of the Company rose from the RM32.9 million registered in the same quarter of 2010 to RM50.8 million in the fourth quarter of 2011, an increase of RM17.9 million or 54.4%.
Group revenue of RM13,556.4 million for the financial year ended 31 December 2011 surpassed the RM12,820.2 million registered in the year 2010 by RM736.2 million or 5.7%.
Group profit before taxation for the financial year ended 31 December 2011 improved to RM1,381.2 million from the RM1,313.2 million recorded in the year of 2010 due to the significantly higher profit registered by the Automotive segment. This represented an increase of RM68.0 million or 5.2%.
However, net profit attributable to equity holders of the Company for the year ended 31 December 2011 declined from the RM526.9 million achieved in the year of 2010 to RM503.0 million due to non-recognition of deferred tax assets of an overseas subsidiary and no tax deduction for asset impairment losses.
Moving forward
Automotive Segment
The Malaysian Automotive Association forecasts the Total Industry Volume (TIV) for the year 2012 to improve from the 600,123 units achieved in 2011 to 615,000 units, an increase of 2.5% or 14,877 units.
Collectively, Perodua and UMW Toyota target to sell a total of 281,000 units or 45.7 % of the TIV in 2012. This represents an increase of 10,560 units or 3.9% over the 270,440 units sold in 2011.
Equipment Segment
Revenue for the Equipment segment is expected to be maintained at the 2011 level. This is because the higher revenue from the stronger demand for its mining equipment is likely to be offset by lower revenue contributions from the logging sector as demand for timber is expected to return to normalcy in 2012.
However, profitability of this segment is expected to improve significantly as neither asset impairment nor further provision for the maintenance and repair contract are anticipated for the year 2012.
Oil & Gas Segment
Operating profit of the Oil & Gas segment in 2012 is expected to improve significantly in consideration of a full-year contribution from Naga 3 as well as higher day-rates for its land rigs, Ghazal 3 and 4 and a full-year contribution from Ghazal 5. Profits are said to improve further with the installation and commissioning of equipment and facilities for the Garraf Power Plant in Iraq which is expected to be substantially complete in 2012.
Changes in fair value of UMW’s overseas investments as well as hedging instruments used to hedge various financial risks may affect the overall performance of the Oil & Gas segment for the year 2012.
Manufacturing & Engineering Segment
Performance of this segment is expected to improve in 2012 considering the higher capacity utilization of its four new automotive component plants in India and improved plant capacity utilization of up to 64% for its new lubricant plant located in Xinhui, China. Sales of Repsol and Pennzoil lubricant products are also expected to increase in 2012.
The Board is pleased to declare a final single-tier dividend of 15% or 7.5 sen (2010 -13% or 6.5 sen) per share of RM0.50 each, for the financial year ended 31 December 2011. The proposed final dividend, if approved by shareholders, will be paid on 10 August 2012.
The total single-tier dividend for the financial year ended 31 December 2011 would be 31 sen or 62% per share of RM0.50 each. This payout represents approximately 72.7% of the 2011 net profit attributable to shareholders of UMW (net of unrealized gains) against its target headline KPI for dividends of at least 50%.
