By RAHIMI YUNUS / Pic By MUHD AMIN NAHARUL
DRB-Hicom Bhd has narrowed its net loss in the first quarter ended June 30, 2018 (1Q19), despite posting a lower revenue.
The conglomerate stated in an exchange filing yesterday that its net loss shrank by 63.6% year-on-year (YoY) to RM66.6 million — an improvement by RM116 million from a net loss of RM183 million in the same period last year.
However, DRB-Hicom’s revenue slipped by 15.2% YoY to RM2.65 billion compared to RM3.13 billion, as a result of the lower sales recorded by its automotive sector.
Overall, the group’s automotive sector contributed RM1.4 billion to the revenue, followed by the services sector with RM1.11 billion and the property sector at RM143 million.
The company stated that the decrease in the automotive division was largely due to lower sales of vehicles by Proton Holdings Bhd and some other automotive companies.
DRB-Hicom’s services sector recorded marginally lower revenue from the banking, postal and logistics businesses, while the property sector saw a better result which was mainly attributed to revenue recognised from construction- related projects.
Prospects remain positive as the automotive sector is expected to pick up momentum with the impending launch of Proton’s first SUV by year-end, along with other launches from di f ferent marques, supported by active promotional activities.
Its unit — DRB-Hicom Commercial Vehicles Sdn Bhd — is on course to set up a local assembly facility for India’s largest commercial vehicle manufacturer, Tata Motors Ltd, at its plant in Pekan, Pahang.
The group will continue to find ways to unlock value from its assets which include the recent disposal of waste management subsidiary Alam Flora Sdn Bhd, as well as the earlier proposed rationalisation of non-industrial property assets.
DRB-Hicom sold its stake in Alam Flora to Malakoff Corp Bhd for RM944.6 million in cash as the conglomerate seeks to pare down its borrowings and partly finance Proton.
The company’s share price closed lower yesterday by 3.85%, or nine sen, to RM2.25 per unit with a market capitalisation of RM4.41 billion.