DRB-Hicom appoints Wan Zulkiflee as chairman, posts RM4.7b in revenue for 1H20
drb-hicom

by NG MIN SHEN & NUR HANANI AZMAN

DRB-HICOM Bhd has appointed former Petroliam Nasional Bhd (Petronas) CEO Tan Sri Wan Zulkiflee Wan Ariffin as its non-executive chairman effective today.

He replaces Datuk Mohammad Zainal Shaari, whose resignation took effect yesterday.

DRB-Hicom had appointed the former Petronas CEO as an independent non-ED since Aug 1 before redesignating him to the position of chairman.

Wan Zulkiflee is currently the non-executive group chairman of Malaysia Airlines Bhd and Malaysia Aviation Group Bhd.

Before joining Malaysia Airlines, Wan Zulkiflee served as president and group CEO of Petronas from April 2015 until June 2020.

He began his career with the national oil company in 1983 and has held various positions within the group.

Wan Zulkiflee also held positions at global and regional bodies, including as a member of the World Economic Forum (WEF) Stewardship Board of System Initiative on Shaping the Future of Energy, a member of the WEF Oil and Gas (O&G) Governors Forum and the WEF O&G Industry Action Group, and served as Malaysia’s alternate member on the Asia-Pacific Economic Cooperation Business Advisory Council.

“The board and I are delighted to have the esteemed calibre of Wan Zulkiflee with his proven leadership at the global arena as our chairman in the furtherance of the group’s strategic direction and focus at this current time,” DRB-Hicom group MD Datuk Seri Syed Faisal Albar Syed Albar said in a statement last Friday.

He also thanked Mohammad Zainal for his contributions and commitment towards the group’s long-term success.

The group recorded revenue of RM4.74 billion in the first half ended June 30, 2020 (1H20), led by its automotive sector as car sales were lifted by the tax holiday.

For the six months in focus, the group posted a net loss of RM479.36 million, it said in an exchange filing last Friday.

In the second quarter ended June 30, 2020 (2Q20), revenue amounted to RM2 billion while net loss stood at RM306.08 million.

“These numbers reflect the impact of the Covid-19 and Movement Control Order (MCO) that is now in its fifth month,” DRB-Hicom said in a statement last Friday.

Specific to 2Q20, full economic activities only started to resume in mid-May upon the gradual reopening of the economy as announced by the government.

“Apart from the impact of the lesser working days in the quarter, the group was also affected by the modification loss recorded by Bank Muamalat Malaysia Bhd arising from the financing moratorium that was introduced by the government to ease the burden of the rakyat, apart from impairment loss of certain fixed assets,” the group added.

No year-on-year quarterly comparisons were provided in the current financial year, due to the change of the firm’s fiscal year-end to Dec 31 from March 31 previously.

During the 1H20, the group recorded automotive revenue of RM2.87 billion, boosted by the sales tax exemption. Its automotive brands represent some 33% of the total industry volume in Malaysia.

Revenue was mainly derived from sales of vehicles and components by Proton Holdings Bhd, automotive distribution companies and also from manufacturing and engineering and aerospace companies.

However, automotive sales for 1H20 were also affected by the temporary closure of business operations from mid-March to early May due to the MCO.

Services revenue came in at RM1.7 billion in the 1H with Pos Malaysia Bhd boosting their parcel delivery numbers in the period as Malaysians adjusted their shopping habits towards online channels.

“The national postal company’s revenue has also been positively impacted by the revised postal tariff that was implemented beginning February 2020,” DRB-Hicom added.

Meanwhile, the group’s properties revenue of RM172.24 million in 1H20 reflected the impact of lower activities in the construction sub-sector amid pandemic containment measures, as well as lower sales of properties.

Despite the effects of the pandemic and the MCO, the group said recovery efforts by its businesses are currently ongoing and should be reflected in its 2H20 performance.

Reaping the benefits from the sales tax exemption for passenger vehicles until December 2020, the firm’s other marquees are also expected to boost their sales performance in 2H20, featuring new or revised models.

Pos Malaysia’s ongoing transformation efforts will also augment the improved tariff rates approved earlier this year, and the growing demand for e-commerce.

Other businesses of the group will continue to adapt to the “new normal” environment to ensure financial sustainability, against a backdrop of changes in customer and consumer behaviour.