KUALA LUMPUR (Nov 17): Warisan TC Holdings Bhd returned to the black with a net profit of RM3.37 million in the third quarter ended Sept 30, 2015 (3QFY15) from a net loss of RM2.19 million a year ago, primarily due to the better performance of its automotive division and lower operating cost recorded by the travel and car rental division.

Revenue for 3QFY15 rose 8.9% to RM122.03 million from RM112.07 million in 3QFY14, primarily due to higher volume of sales by the automotive division.

However, it posted a net loss of RM363,000 for the nine months period (9MFY15) compared with a net profit of RM1.89 million in 9MFY14, on lower revenue.

The group also said its share of profit of its joint ventures, namely Shiseido Malaysia Sdn Bhd and Wacoal Malaysia Sdn Bhd, fell 35.6% compared with 9MFY14 primarily due to foreign exchange losses and higher advertising and promotional expenses incurred by Shiseido.

Revenue for 9MFY15 declined 4.7% to RM340.24 million from RM356.89 million in 9MFY4, primarily due to the lower contribution from the travel and car rental division.

In a filing with Bursa Malaysia today, Warisan TC said the travel and car rental division saw an 8% decline in revenue to RM145.3 million in 9MFY15 from RM158 million in 9MFY14. This was primarily due to fewer rental vehicles disposed compared with the corresponding period prior year.

Warisan TC added that the business environment in Malaysia continues to be challenging with a weakened consumer sentiment on
the backdrop of subdued economic growth.

"The weak ringgit, potential US interest rate hike and tighter lending conditions are expected to continue to dampen consumer spending," it noted.

To chart through the challenging operating environment, Warisan TC said the group will continue to intensify its sales and marketing initiatives while at the same time placing even greater emphasis on productivity improvements to lower its operating costs.

"The group is cautious on the near term outlook of its businesses, but remains positive on their longer term prospects," it said.

Warisan TC shares closed up 10.74% or 29 sen at RM2.99 today, bringing a market capitalisation of RM194.66 million.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)