KUALA LUMPUR (April 26): Cycle & Carriage Bintang Bhd, which distributes Mercedes-Benz cars in Malaysia, said on Tuesday (April 26) that its first quarter net profit more than doubled to RM8.55 million from RM3.39 million a year earlier, as revenue rose on higher vehicle sales volume, helped by Malaysia's sales tax reduction which supported consumer demand for cars.

In a Bursa Malaysia filing, Cycle & Carriage said revenue rose to RM300.02 million in the first quarter ended March 31, 2022 (1QFY22) from RM292.83 million.

"The group’s revenue for the three months ended 31st March 2022 was RM300.0 million, 2% higher than the same period in 2021, mainly attributed to a 1% increase in vehicle unit sales and an increase in the aftersales volume by 12% as a result of the easing of lockdown restrictions.

"A net profit of RM8.6 million was recorded compared to a net profit of RM3.4 million in the same period in 2021. The group continues to benefit from the sales tax reduction which supported the demand for consumer vehicles. Alongside a more favourable sales mix and lower financing costs, overall net profit improved," Cycle & Carriage said.

The group did not declare any dividend for 1QFY22.

According to Cycle & Carriage ,its net debt improved from RM30.6 million at the end of 2021 to net cash of RM21.7 million as at March 31, 2022, due to improved working capital.

The group said it continues to monitor its debt level and liquidity positions to mitigate both operational and financial risks.

Looking ahead, Cycle & Carriage said market recovery and consumer sentiment remain uncertain.

In addition, it is expected that the imbalance in global demand and supply of semiconductor chips will not be fully resolved in 2022 and the situation will continue to impact the automotive industry, according to the company.

"The group takes a long-term view on its strategic goals, focusing on bolstering its capabilities to bring exceptional journeys to customers and employees, while staying on-track and agile with its business improvement plans," Cycle & Carriage said.