Malaysia's Sime Darby Reports Highest Quarterly Net Profit

By Yantoultra Ngui Features Dow Jones Newswires

KUALA LUMPUR, Malaysia--Malaysian plantations-to-automotive conglomerate Sime Darby Bhd. (4197.KU) on Thursday announced its highest quarterly earnings when net profit for the fiscal first quarter jumped over 152% on-year mainly due to higher earnings from its plantation and property divisions.

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Net profit for the July-September period surged to 1.32 billion ringgit (US$316 million) from MYR522 million in the same quarter a year earlier, according to financial statements filed to the local stock exchange.

Revenue rose 17.5% to MYR8.14 billion during the quarter from MYR6.93 billion last year, according to the filing.

"This performance augurs well for the divisions as we step into the final days leading up to the listings of the pure plays, embarking on a new journey to unlock value," Sime Darby's president and group chief executive Mohd Bakke Salleh said in a statement.

The conglomerate, whose plantations' arm is the world's largest palm oil producer by land size, is due to demerge with the listings of Sime Darby Plantation Bhd. and Sime Darby Property Bhd. on Nov. 30.

It will focus on its trading businesses in the motors and heavy-equipment sectors, and involve in logistics business and health-care industries moving forward.

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In notes accompanying its financial results, Sime Darby said its motors operations continues to be impacted by strong competition and cautious consumer sentiment. It said it would be exiting the current distributorship and dealership business in Vietnam.

Port operations in Weifang, China continue to be affected by the slower economic growth and competitive market, Sime Darby said.

On the bright side, the company said its industrial operations in Australia have seen improvement in recent months in the product support business along with an increase in the order book.

The board expects Sime Darby's performance for the fiscal year ending June, 30 2018 to be satisfactory, according to the notes.

Shares of Sime Darby ended the morning trading session 0.9% lower at MYR8.92 prior to the earnings release.

- Write to Yantoultra Ngui at yantoultra.ngui@wsj.com

(END) Dow Jones Newswires

November 16, 2017 01:15 ET (06:15 GMT)