KUALA LUMPUR (Nov 18): MBM Resources Bhd's net profit fell 27.4% to RM25.49 million, or 6.52 sen per share, for the third quarter ended Sept 30, 2014 (3QFY14) from RM35.12 million, or 8.99 sen per share, a year earlier.

The group attributed the decline in net profit to the lower deliveries by the manufacturing division in line with lower production volumes from major car makers.

Quarterly revenue declined nearly 12% to RM484.05 million from RM549.34 million previously.

In a filing with Bursa Malaysia today, MBM said revenues from motor trading declined by 13.7% to RM388.6 million due to lower sales volumes from Volkswagen and Perodua.

"However, overall higher aftersales revenue and continuous cost management efforts helped improve operating profits by 84.6% to RM3.8 million," it said.

MBM said auto parts manufacturing revenues fell by 3.7% to RM95.5 million and operating profits declined by 49.3% to RM7.6 million.

"This was attributable to lower deliveries in line with lower demand from major car makers and losses incurred by the new alloy wheel manufacturing operations," it added.

For the nine months period ended Sept 30, 2014 (9MFY14), MBM's net profit slump 23.7% to RM80.15 million from RM105.03 million, while revenue inched down 9.82% to RM1.56 billion from RM1.73 billion last year.

On prospects, MBM expects its motor trading division to gain traction in the fourth quarter on the back of new model launches and continued growth in aftersales throughputs.

On its 78%-owned Oriental Metal Industries (M) Sdn Bhd (OMI) Alloy, MBM expects it continues to record losses.

"However, revenues are expected to improve in the fourth quarter because it has secured orders to a major car model. The losses from investments in new manufacturing facilities by our associates are expected to narrow by the end of this year," it added.

MBM share price dropped three sen or 1.05% at RM2.82 albeit thin trading volume of 19,600 shares changing hands. With the closing price, MBM has a market capitalisation of RM1.1 billion.