DRB-Hicom swings back to black in 2Q with RM170 mil net profit

KUALA LUMPUR (Aug 15): DRB-Hicom Bhd returned to profitability in the second quarter of June 30, 2022 (2QFY22) with a net profit of RM169.6 million, from a net loss of RM217.5 million a year ago.

Earnings per share stood at 8.77 sen, against losses per share of 11.25 sen last year, its bourse filing showed.

Quarterly revenue increased 35% to RM3.55 billion from RM2.62 billion in the same period last year, driven by overall business improvement.

According to DRB-Hicom, better operating results from major operating companies, as well as receipt of the remaining 20% proceeds from the disposal of its former subsidiary Lotus Advance Technology Sdn Bhd amounting to RM119.51 million allowed the group to reverse its pre-tax loss of RM279.5 million in 2QFY21 to a pre-tax profit of RM229.2 million in the latest quarter.

For the six-month period (1HFY22), the group recorded a net profit of RM143.82 million against a net loss of RM234.46 million, on the back of slightly higher revenue of RM6.62 billion from RM6.13 billion previously.

According to the group, its automotive sector posted a revenue of RM2.53 billion in the second quarter, as car buyers thronged showrooms to take advantage of the sales tax exemption offered by the government.

DRB-Hicom’s banking unit Bank Muamalat Malaysia Bhd recorded a revenue of RM302.7 million in 2Q22, compared with RM274 million posted in 2Q21, on the back of higher financing income attributed to the increase in average volume.

For the first six months, the bank netted a revenue of RM587.7 million, as personal financing and property financing income rose.

However, this was offset by lower revenue at Pos Malaysia Bhd, which fell 7.9% to RM349.1 million against RM379 million a year ago, mainly due to the decline in its courier business following the decrease in overall parcel volume, especially from contract customers.

“In addition, major e-commerce players leveraged their insourced delivery capabilities, while international players pursued penetration strategies in order to capture higher market share in the courier business,” said DRB-Hicom.

Similarly, lower construction project work progress saw DRB-Hicom’s property segment revenue slip, although this was somewhat mitigated by sales at Proton City and Hicom Pegoh Industrial Park.

Revenue at the division was recorded at RM115.76 million in 1H22, against RM124.57 million in 1H21.

In a separate statement, the conglomerate said Proton aims to deliver more than 90,000 units of its existing orders by the first quarter of 2023.

“The banking segment is expected to grow in its retail financing due to better prospects of the domestic economy. The group’s postal segment will continue its transformation plan by maintaining a market-leading next-day service level, driving cost efficiencies, increasing parcel yields and ensuring optimum customer experience at every touchpoint,” it added.

DRB-Hicom closed up 5 sen or 3.42% at RM1.51 on Thursday (Aug 25), valuing the conglomerate at RM2.92 billion.