by SULHI KHALID/ pic by TMR FILE
DRB-HICOM Bhd’s financial fortunes have improved significantly driven by its automotive business and the revival of Proton Holdings Bhd in particular.
The group posted a net profit of RM46.21 million for the three months ended June 30, 2019, against a net loss of RM66.59 million in the same period a year earlier.
Revenue for the quarter rose 29.5% year-on-year (YoY) to RM3.44 billion.
This comes after its automotive segment recorded a 59.2% YoY increase in sales to RM2.23 billion, underpinned by higher sales over Proton’s various launches of facelifted models recently.
Quarterly revenue jumped 29% YoY to RM3.44 billion as Proton delivered 52,108 units of vehicles up to July in the 2019 calendar year, compared to the 35,561 units it sold in the same period in 2018, DRB-Hicom noted in a statement last Friday.
The group recently unveiled its new facelifted Proton Saga and is slated to launch its compact B-segment SUV, the Proton X50, in August next year.
DRB-Hicom’s share price closed at a seven-year high of RM2.95 last Friday.
AmInvestment Bank Bhd in a research report recently highlighted that Proton is the only major carmaker that registered a YoY sales improvement in July 2019, despite a high base last year from the tax holidays.
“Proton successfully ousted Honda (Malaysia Sdn Bhd) and claimed its position as the runner-up in year-to-date market share.
“With the sustained momentum and deliveries from volume-oriented models like the Persona and Iriz, we strongly believe Proton will end 2019 in second place, behind Perodua (Perusahaan Otomobil Kedua Sdn Bhd),” the research house said.
Proton has reclaimed the second spot in terms of sales in the Malaysian automotive market.
The growth trend is fuelled by its best-selling model, the five-seater SUV X70 and the Proton Persona B-segment sedan.
The last time the company was in a similar position had been in March 2016, while the last calendar year that it had ended ranked second in terms of sales was back in 2015.
Meanwhile, DRB-Hicom’s revenue for the services sector remained flat at RM1.09 billion.
“The property segment’s revenue was lower as construction-related projects were at various stages of progress,” it said.
DRB-Hicom is currently operating a nine-month financial year in 2019, as the group has changed its financial year-end from March 31 to Dec 31.
On its outlook, the conglomerate expects its automotive businesses to remain resilient as the new Proton models are anticipated to boost its financial performance.
The Proton X70 continues to be the leader in the SUV segment with 1,932 units delivered in July and a total of 17,023 units for 2019.
The group added that its subsidiary Pos Malaysia Bhd’s businesses continue to operate in a competitive environment affected by price and cost challenges, but noted efforts are ongoing to address the issues.
DRB-Hicom’s other businesses are in the defence, banking, concession and property sectors.