UMW’s 1Q profit jumps 27% as stronger demand lifts revenue

KUALA LUMPUR (May 24): UMW Holdings Bhd’s net profit for the first quarter ended March 31, 2022 (1QFY22) grew 26.82% to RM101.21 million from RM79.8 million in the previous year's corresponding quarter, as stronger contribution from its automotive and equipment segments lifted the group's revenue.

Earnings per share increased to 8.66 sen from 6.83 sen previously, according to the automotive company’s filing with the bourse. Revenue was up 23.58% to RM3.65 billion from RM2.95 billion, amid demand improvement seen in the economic recovery under the National Recovery Plan.

In particular, the group's automotive business reported a 28.1% increase in revenue for 1QFY22, compared with RM2.4 billion for 1QFY21, with higher number of vehicles sold driven by the sales tax exemption, and the introduction of new models.

The equipment segment’s revenue grew 11.8% to RM371.8 million from RM332.5 million, amid higher demand for the segment’s products and services in the local and overseas markets due to the expected transition of the pandemic to the endemic phase.

On prospects, UMW said, the group anticipates its performance for FY22 to be satisfactory.

“Nevertheless, the group remains cautious of the various external headwinds, including the lingering threat of Covid-19, the persistent and prolonged supply chain disruptions, as well as the impact of further escalation of geopolitical conflicts.

“In view of the headwinds, the group will continue to execute its strategic initiatives focusing on driving operational efficiencies and undertaking cost optimisation activities to improve its resilience,” said UMW president and group chief executive officer Datuk Ahmad Fuaad Kenali.

On Tuesday, UMW shares closed up six sen or 1.82% at RM3.35, valuing the company at RM3.91 billion.

The stock has risen 12.79% year-to-date from RM2.97.