KUALA LUMPUR (Feb 22): Sime Darby Bhd’s second quarter net profit fell 53% to RM305 million from RM653 million a year ago, with earnings per share down to 4.5 sen from 9.8 sen. 

Revenue for the quarter ended Dec 31, 2017 (2QFY18) however, saw a 9.02% rise to RM8.82 billion, from RM8.09 billion in 2QFY17. 

The group said in its filing to Bursa Malaysia that most of its operating business segments posted increased profit, except for the motors division which declined 83.1% due to losses of RM109 million incurred in Vietnam, versus a RM5 million profit in 2QFY17. 

“Excluding the Vietnam operations, profit for the quarter was 0.8% higher than 2QFY17. The higher profit from the China and Hong Kong operations were offset by the lower profit from the Malaysia and Singapore operations,” the filing added.

Sime Darby said Yayasan Sime Darby (YSD) has been reclassified as assets held for sale as it would no longer be consolidated by the group, following the foundation’s membership and governing council changes in January 2018. 

“As such, YSD’ net assets have been written down to its recoverable amount of nil, resulting in a writedown of RM61 million,” the filing added.

The board declared an interim single tier dividend of two sen, compared with six sen last year, payable on May 8. 

For the six months period (6MFY18), net profit expanded by 37.96% to RM1.62 billion from RM1.18 billion a year earlier, while revenue increased 12.91% to RM16.96 billion from RM15.02 billion. 

Sime Darby chief executive officer Jeffri Salim Davidson said the operational results have been very encouraging, largely because of an upturn in the mining business in Australia and increased automotive and equipment sales in China. 

“There have been some one-off adjustments which affected the 6MFY18 results arising from our decision to exit the BMW operations in Vietnam. There is also the adjustment as a result of the de-consolidation of YSD, following the pure-play exercise, but these were off-set by a gain from the sale of property in Australia,” Davidson added. 

Moving forward, the board expects core profits for FY18 to be higher than FY17. 

Sime Darby shares rose two sen or 0.73% to close at RM2.75 today, for a market capitalisation of RM18.7 billion.