KUALA LUMPUR (Nov 27): Sime Darby Bhd's net profit for its first quarter ended September (1QFY2024) rose to RM589 million from RM207 million in 1QFY2023, as all segments improved, led by the industrial division, coupled with a RM251 million gain on disposal of Malaysia Vision Valley land to Sime Darby Property Bhd.

Revenue in the quarter rose 14.76% to RM13.98 billion, from RM12.18 billion, led by higher revenue in the motors segment, its filing showed.

This was the strongest quarterly revenue for the group since 4QFY2012, when it recorded RM14.12 billion revenue with RM1.1 billion net profit, and when its plantation and property divisions were still operating within the Sime Darby listed entity.

The improved performance in the industrial segment was supported by contribution from Onsite Rental Group, which Sime Darby acquired in April 2023.

The overall positive motors performance was attributable to the Malaysian operations, it said, citing slowdown in China which resulted in lower profit margins in the region.

Quarterly earnings per share amounted to 8.6 sen, from 3.1 sen in 1QFY2023.

On a quarter-on-quarter basis, Sime Darby’s revenue rose 5.2% from RM13.29 billion. Segment-wise, the industrial segment saw a 4.5% decrease in segment results, while normalised motors segment grew 11.5% on higher Malaysian operations profits.

In a statement, Sime Darby’s group chief executive officer Datuk Jeffri Salim Davidson pointed to the successful acquisition of South Australia’s Caterpillar industrial machinery dealer Cavpower Group.

“South Australia is home to over 150 mining companies, and we are confident that there are tremendous opportunities for the heavy equipment and rental business,” Jeffri said.

He also pointed to Sime Darby’s full exit from the healthcare business through its RM5.68 billion divestment of Ramsay Sime Darby Health Care Sdn Bhd to Columbia Asia Healthcare Sdn Bhd earlier this month.

Additionally, Sime Darby in August proposed to acquire a 61.2% stake in UMW Holdings Bhd from Permodalan Nasional Bhd for RM3.57 billion, with aims to make a general offer and take UMW private.

”Looking forward, we are highly optimistic that the UMW deal will help to broaden our earnings and allow us to capitalise on the mass volume segment, while unlocking further value by leveraging our proven strengths and capabilities in the automotive sector,” Jeffri said.

Shares of Sime Darby rose two sen or 0.84% to RM2.39 at the noon market break, giving it a market capitalisation of RM16.29 billion.

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