KUALA LUMPUR (May 25): Sime Darby Bhd saw an 80.5% drop in net profit to RM135 million in the third financial quarter ended March 31, 2018 (3QFY18) from RM692 million a year ago. However, it is worth noting that 3QFY17’s net profit of RM692 million included results from the discontinued operations from the plantation and property divisions, which were demerged from the group late last year.

Sime Darby’s continuing operations recorded a net profit of RM135 million in 3QFY18, dropping 28.6% from RM189 million in 3Q 2017.

Revenue for continuing operations in 3QFY18 rose 5.4% to RM8.29 billion from RM7.87 billion a year ago.  

The drop in profitability was attributed to a profit decline in its motor division and impairment of billings amounting to RM28 million from the discontinued oil and gas operations in the current quarter under review.

Net profit for 3QFY18 was also comparatively lower than its previous corresponding quarter due to additional interest income in 3QFY17, the group added.

The weaker quarterly earnings dragged the group's net profit for the cumulative nine months ended March 31, 2018 (9MFY18) down 5.9% to RM1.76 billion from RM1.87 billion a year ago.

Revenue, however, was up 10.3% to RM25.25 billion from RM22.89 billion in 9MFY17.

In a separate statement, Sime Darby group chief executive officer Jeffri Salim Davidson said the group will remain focused on its core sectors and will continue to explore opportunities to accelerate growth and drive its businesses forward.

"On May 3, we officiated the opening of the new BMW engines assembly facility in Kulim, Kedah. The assembly of BMW engines in Kulim will increase the local content of our cars, making them more cost competitive,” he added.

Sime Darby expects the group’s performance for the financial year ending June 30, 2018 to be satisfactory.

Sime Darby shares closed up 8 sen or 2.98% at RM2.76 today, with 20.57 million shares done, bringing it a market capitalisation of RM18.23 billion.