KUALA LUMPUR: UMW Holdings Bhd sees a challenging year ahead after earnings in the first quarter was halved due to lower sales of new car and weaker results from its heavy equipment business.
Net profit for the three-month ended March 31 declined 49% to RM44.3mil compared with RM86.5mil made a year ago.
Revenue was down to RM2.12bil from RM2.78bil previously, UMW Holdings said in a filing with Bursa Malaysia today.
"Despite the subdued market environment, the Group is cautiously optimistic of improving demand from customers post-MCO," it said.
"Furthermore, the Group plans to launch a pipeline of exciting new models to soften the impact of market slowdown."
UMW is the manufacturer and distributor of Toyota cars in Malaysia. It also has a 38% stake in Perusahaan Otomobil Kedua Sdn Bhd (Perodua).
Meanwhile the group's heavy equipment business includes brands such as Komatsu Bomag, LS Mtron, Rosenbauer, Elgin and Everdigm - all strong industry players in the construction, mining, logging and agricultural and industrial sectors.
The heavy equipment division operates in Malaysia, as well as several other countries such as Singapore, Brunei, Papua New Guinea and Myanmar.
"The Heavy Equipment sub-segment may face sluggish domestic demand due to the delay in implementation of projects caused by the Covid-19 pandemic and slowdown in some sectors it operates in," it said.
"Nevertheless, encouraging demand in mining and construction sectors in its overseas operations could help to soften the impact."
The company is also expanding its equipment rental business while extending recovery packages to help small and medium enterprises.
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