KUALA LUMPUR (Feb 21): Sime Darby Bhd grew its net profit in the second quarter ended Dec 31, 2018 (2QFY19) by 3.9% to RM317 million, driven by better performance in its industrial and motors division.
For a like-for-like, year-on-year comparison, only the group's continuing operations, namely the industrial, motors, logistics and healthcare businesses, are relevant.
Quarterly earnings per share grew to 4.7 sen, from 4.5 sen in 2QFY18, Sime Darby's bourse filing showed.
The group has declared a dividend of 2 sen per share, payable on May 8.
In the quarter, Sime Darby's profit after tax from continuing operations grew near four-fold to RM337 million from RM85 million, which more than made up for the absence of profit from discontinued operations which amounted to RM259 million last year.
Concurrently, quarterly revenue grew 6.9% to RM9.42 billion from RM8.82 billion previously.
For the first half ended Dec 31, 2018 (1HFY19), Sime Darby saw net profit fall 66.6% to RM542 million from RM1.62 billion in 1HFY18.
However, minus the profit from discontinued operations and de-consolidated plantation and property business of RM1.3 billion, the group has grown its net profit by 69.4% from RM320 million previously.
The growth, said group chief executive officer Datuk Jeffri Salim Davidson in a separate statement, was largely due to its industrial division in Australia and the upturn in the mining and construction sectors.
"Demand for our products and services from the mining and construction sector there [has] been strong.
"However, we are seeing a slight softening in the group's motors business, particularly in China and Singapore," he added.
Moving forward, Sime Darby expects the industrials division to be supported by growth in Australia, which could compensate for the possible slowdown in Chinese demand in light of the trade war.
Meanwhile, the motors division is expected to face strong competition and possibly pressure in demand amid expected slowdown in economic growth.
At noon market break, shares of Sime Darby fell two sen or 0.9% to RM2.27, giving it a market capitalisation of RM15.44 billion.