By TMR

MBM Resources Bhd’s net profit more than doubled to RM34.55 million for its second quarter ended June 30, 2018 (2Q18), from RM16.15 million in 2Q17, owing to higher sales and turnover.

In an exchange filing yesterday, the automaker noted the increase in profit was in line with group revenue rising 22.1% year-on-year (YoY) to RM493.32 million following the zero-rating of the Goods and Services Tax (GST) in June, which boosted car demand.

For the motor trading business, the company noted higher demand for all models, especially Perodua and Volkswagen. Its auto parts manufacturing segment benefitted from higher demand for alloy wheels.

Share of results from joint ventures, coupled with foreign currency gains, also boosted the 2Q18 performance.

For the first half of 2018, net profit for the company was up 89.3% YoY at RM67.36 million, while revenue improved 16.4% YoY to RM956.78 million. The company also declared a three sen dividend for the quarter.

MBM expects the improved sales trend will continue into 3Q18, but noted higher demand will be suppressed by uncertainties following the re-introduction of the Sales and Services Tax next month.

It added that the insufficient stocks to meet market demand during the GST-free period is also a concern going forward.