KUALA LUMPUR – UMW Holdings Bhd recorded a net loss of RM47.9 million in the third quarter ended September 30 this year (Q3) from a net profit of RM83.87 million in the corresponding period last year.
Revenue decreased to RM2.02 billion from RM2.66 billion previously, mainly due to lower sales in the automotive, as well as manufacturing and engineering segments during the quarter, where only certain operations of the group were allowed to operate through limited capacity with the easing of movement restrictions from August 16 this year under the National Recovery Plan.
“The automotive segment recorded a revenue of RM1.59 billion, 25.2% lower than the RM2.13 billion reported in the corresponding quarter last year, mainly due to the lower volume of vehicles sold in Q3 resulting from FMCO (full movement control order) and the resumption of businesses from August 16, coupled with the ongoing shortage of semiconductor chips,” it said in a filing with Bursa Malaysia today.
On the current prospects of the automotive segment, the company said it is ramping up production to meet the encouraging outstanding order book.
“Demand for automotive products is expected to continue to remain strong, following the extension of the sales tax exemption.
“Although the group has managed to mitigate the impact of the semiconductor chips shortage for the year, the group will continue to work closely with principals and suppliers to secure a consistent supply of semiconductor chips in the medium to longer term.
“Introduction of new models, including hybrid electric vehicles, as well as the year-end sales promotion are expected to drive stronger sales in Q4,” it said.
UMW said prospects for the auto components and lubricants sub-segments are gradually improving, as disruptions to the supply chain have progressively eased and businesses have started to ramp up production.
“In addition, demand for the replacement equipment market will continue to improve in line with the recovery of the automotive industry.
“The aerospace sub-segment is expected to benefit from the gradual reopening of international travel, and the demand for fan cases is expected to increase from next year onwards,” it said.
The group expects the business environment to continue to remain challenging for the remainder of the year, and will continue to manage the negative impact of the Covid-19 pandemic on its operations. – Bernama, November 29, 2021
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