Sime Darby records 69.4% jump in 1H net profit to RM542m

KUALA LUMPUR: Sime Darby Bhd's continuing operations posted a 69.4% increase in net profit to RM542mil for the six months ended Dec 31, 2018, from RM320mil in the previous corresponding period due to strong contribution from the group's industrial division. 

Group revenue for the period came to RM18.3bil, 7.7% higher from RM17bil in 1H FY2018.

"Sime Darby Bhd’s performance in the first half of FY2019 was pretty solid due largely to our Industrial Division in Australia," said group CEO Datuk Jeffri Salim Davidson in a statement.

"Demand for our products and services from the mining and construction sector there have been strong."

The group announced a first interim dividend of two sen per share for the financial year ending June 30, 2019.

On a segmental basis, the group's industrial division recorded a 53% year-on-year increase in core profit before interest and tax (PBIT) of RM348mil due to higher equipment deliveries in Australia and higher margins from engines and product support.

However, the group's motor division fared poorly with softer markets seen in most of its business markets. Core PBIT for 1H FY2019 was RM225mil, 16.4% lower than in 1H FY201.

The Malaysian motor operations proved to be the exception as the zero-rated GST period last year boosted sales. It recorded a PBIT of RM240mil, which was a 77.8% jump from 1HFY2018, which included a loss of RM184mil for BMW Vietnam.

The logistics segment experienced lower bulk throughout at its Weifang and Jining ports, leading to a core PBIT of RM26mil. However, the division's PBIT leapt 141.9% to RM104mil due to a RM78mil gain from the sale of Weifang Water.

As for its 50%-held joint venture, Ramsay Sime Darby Health Care achieved a PBIT of RM30mil in 1H FY2019, 20% higher than in the previous corresponding period due to higher operational revenue. 

For 2Q FY2019 ended Dec 31, 2018, the group posted a higher net profit of RM317mil year-on-year while revenue rose 6.9% to RM9.5bil.