Shah Alam, 29 May 2012 – The UMW Group announced today that its Group revenue of RM3,695.8 million for the first quarter ended 31 March 2012 surpassed the RM3,221.2 million registered in the preceding year’s corresponding quarter by RM474.6 million or 14.7%. Higher revenue from all business segments of the Group, particularly the Oil & Gas and Equipment segments, accounted for the increase.
As a result, Group profit before taxation for the first quarter ended 31 March 2012 escalated to RM433.3 million from the RM339.5 million registered in the same quarter of 2011, an improvement of 27.6% or RM93.8 million. Significantly higher profit contributions from the Automotive, Oil & Gas and Equipment segments, resulted in the surge in profit.
Consequently, net profit attributable to equity holders of the Company in the first quarter of 2012 improved substantially to RM220.0 million from the RM151.8 million registered in the same quarter of 2011, an increase of RM68.2 million or 44.9%.
Automotive Segment
In the first quarter of 2012, UMW Toyota Motor ramped up its production and successfully recouped its 2011 production shortfalls due to the disruption in critical parts supply caused by the massive floods in Thailand. Combined sales of Toyota and Lexus vehicles improved to 23,834 units in the first quarter of 2012 from the 22,414 units achieved in the same quarter of 2011, an increase of 6.3% or 1,420 units. Bank Negara Malaysia’s responsible lending guidelines have minimal impact on Toyota and Lexus vehicle sales. Higher revenue coupled with favourable exchange rates for United States Dollar resulted in the higher profit contributions from the sales of Toyota and Lexus vehicles.
Similarly, the new hire purchase guidelines introduced in January 2012 has minimal impact on the sales of Alza and the new MyVi, two core models of Perodua.
However, sales of its entry-level Viva model were adversely affected with a 21% drop in sales in the first quarter of 2012. Although Viva bookings were healthy, registration or conversion to sales was relatively low as the new guidelines have resulted in much lower loan approval rate, longer processing lead time and reduced loan amounts. Overall, sales of Perodua vehicles fell by approximately 3.9% in the first quarter of 2012 compared to the corresponding quarter in 2011. Despite the lower sales volume, Perodua achieved a slightly higher profit due to favorable sales mix.
Equipment Segment
The Equipment Segment revenue improved significantly by 40.4% or RM177.1 million mainly as a result of the following:
• Strong demand for its major equipment from customers in Myanmar
• Rescheduling of machine deliveries from the fourth quarter of 2011 to the first quarter of 2012, due to unfavorable weather.
Consequently, profit before tax for the Equipment segment increased to RM54.1 million from the RM34.1 million registered in the same quarter of 2011, an improvement of 58.7% or RM20.0 million.
Oil & Gas Segment
For the current quarter ended 31 March 2012, revenue of the Oil & Gas segment more than doubled the RM194.0 million recorded in the same quarter of 2011. This revenue surge of RM236.7 million or 122% was largely attributable to:
• Additional full-quarter revenue contributions by Naga 3, a premium jack-up rig and Hakuryu 5, a semi-submersible rig. Both Naga 3 and Hakuryu 5 were not revenue contributing in the first quarter of 2011
• Significantly higher revenue from the trading of oilfield products and services
• Additional revenue contributions from Garraf Power Plant Phase 1 project.
Consequently, profit for the Oil & Gas segment improved by about 56-fold due to the low base effect. Favourable movement in fair value of its overseas quoted investments also contributed to the profit movement.
Manufacturing & Engineering Segment
Revenue for the current quarter of RM161.4 million was marginally higher that the RM160.6 million recorded in the same quarter of 2011. Higher sales achieved by its automotive parts manufacturing companies in India were offset by lower sales from the switching of power steering system from hydraulic to electric for certain new vehicle models that included the new Perodua MyVi as well as lower sales of lubricant products.
As a result of higher unit overhead cost, profit for the current quarter declined by RM0.8 million to RM4.1 million, although the segment benefited from the favorable foreign exchange rates.
