Friday 29 Mar 2024
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KUALA LUMPUR (Nov 19): China Automobile Parts Holdings Ltd’s (CAP) net profit for the third quarter ended Sept 30, 2014 (3Q14) fell 17.4% to RM19.64 million or 3.27 sen per share, from RM23.75 million or 3.96 sen per share in the previous corresponding quarter, on lower selling prices and higher operating expenses.

Revenue declined 7.5% to RM96.98 million in the quarter, from RM104.8 million in 3Q13.

“Despite an increase in the overall sales volume by 4.3% year-on-year (y-o-y), the drop in the average selling prices by 11.3% y-o-y outweighed the increase in volume, thereby causing the decline in revenue,” the China-based automobile chassis component manufacturer said in its filing to Bursa Malaysia.

As a result of reduced selling prices, the group’s gross margin decreased to 30.9% in the quarter, from 33.6% in 3Q13.

For the nine months ended Sept 30, 2014 (9M14), CAP’s net profit fell 3% to RM56.39 million or 9.4 sen per share, from RM58.09 million or 9.68 sen per share.

Revenue came in 4.5% lower at RM298.1 million, compared with RM312.1 million, mainly due to the drop in the average selling prices by 8.7% y-o-y. This, to some extent, was mitigated by the increase in overall sales volume of 4.6% y-o-y, said CAP.

On prospects, CAP cited China Association of Automobile Manufacturers that demand for commercial vehicles continued to slump year-to-date, noting that for the 9M14, production and sales of commercial vehicles in China were down 5.7% and 6.2% y-o-y respectively.

“In view of the above challenging conditions, the group will intensify efforts to improve costs efficiency and productivity, so as to sustain profitability. Based on the results achieved to-date, the group is reasonably confident of a satisfactory performance for the current financial year,” it said.

CAP — which manufactures u-bolts, wheel axles, wheel-hub bolts and steel pins — closed down 1 sen or 3.17% at 30.5 sen today, giving it a market capitalisation of RM186 million.

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