PETALING JAYA: Expected launches of new car models toward year-end could provide further upside to UMW Holdings Bhd’s already stellar third-quarter (Q3) performance.
The group is looking at a stream of new model (Vios and Yaris facelifted) launching in December and supported by Toyota RAV4 CBU, Lexus UX200 and Toyota Hilux Rogue, with two new CKD models – the Innova and Fortuner – expected in January 2021.
Kenanga Research noted that the company’s core profit after tax and minority interests (PATAMI) of RM95.6mil for the nine-month period of financial year 2020 (FY20) came in at 111% and 70% of its and consensus full-year estimates, respectively.
“The positive variance from our estimate is due to stronger-than-expected contribution from the automotive division and associate Perusahaan Otomobil Kedua Sdn Bhd (Perodua).
“Note that the nine-month core PATAMI excludes Toyota Capital Malaysia’s provision of loan moratorium impact of RM33.8mil, reversal of impairment and receivables (including debt recovery) of RM31.7mil, unlisted oil and gas forex loss of RM27.9mil and other impairment reversal of RM1.6mil, ” it said.
Consequently, Kenanga has increased its forecast FY20 and FY21 core net profit estimates by 87% and 24%, respectively, to reflect the stronger contribution from the automotive division and Perodua.
Year-on-year, UMW’s nine-month core PATAMI plunged 56% mainly due to the lower automotive segment’s pre-tax profit contribution (-65%), which suffered from the closure of businesses during the movement control order (MCO) from March till May and from higher Bukit Raja plant depreciation (+9%).
Additionally, the Toyota and Lexus as well as Perodua brands recorded lower unit sales at 37,339 (-23%) and 145,012 (-19%), respectively.
The equipment segment also faced a challenging market for both the heavy and industrial equipment, especially during the MCO.
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