Tan Chong 2Q net profit jumps 57% on strong sales

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KUALA LUMPUR (Aug 20): Tan Chong Motor Holdings Bhd has reported a 57% jump in its second quarter net profit to RM19.43 million or 2.98 sen per share, from RM12.36 million or 1.89 sen per share a year earlier.

This was despite a 2% fall in revenue for the quarter ended June 30, 2019 (2QFY19) to RM1.07 billion, from RM1.09 billion previously, the group said in a filing today.

Tan Chong declared an interim dividend of two sen per share, payable on Sept 30, 2019.

For the cumulative six-month period  (1HFY19), net profit more than doubled to RM35.41 million from RM16.62 million a year ago, while revenue rose a marginal 1.1% to RM2.15 billion.

Tan Chong said it recorded higher automotive sales during the period, and benefited from the better sales products mix arising from new models launched in Malaysia and overseas.

Over at its financial services division, there was an improvement in earnings before interests, taxes, depreciation, and amortisation (Ebitda), despite lower hire purchase receivables, due to a lower impairment.

These were partially offset by higher net foreign exchange loss recognised in the period under its investments and properties division, which arose from financing overseas entities denominated in foreign currencies.

Tan Chong said while the business environment is expected to remain challenging, the group expects to perform satisfactorily this year.

It added that efforts undertaken to enhance the group’s overall position include the continued expansion of its sales and after-sales network overseas, innovative marketing campaigns, and exploration of potential business opportunities.

Tan Chong shares closed one sen or 0.69% higher today at RM1.45 apiece, valuing the group at RM946.36 million.