Sime Darby Reports Pre-tax Profit Of RM1.3 Billion For 1Q FY08/09
KUALA LUMPUR, 28 November 2008 - Sime Darby Berhad reported a pre-tax profit of RM1.3 billion for the Q1 FY08/09, an increase of 23 per cent over the same period during the last financial year.
The Group recorded a net profit after tax and minority interest of RM867 million, an increase of 44 per cent compared to Q1 FY07/08.
This improved performance in the quarter under review was due in large part to the strong showing of the Plantation Division. The division registered a 39 per cent increase in operating profit to RM968 million on the back of higher crude palm oil prices compared to Q1 FY07/08.
In addition, the Industrial Division also recorded an increase in operating profit of 39 per cent to RM247 million due to the stronger performance of the South East Asian and Australasian operations.
The Property Division’s operating profit however, declined by 30 per cent to RM58 million as the sector continues to experience a more challenging business environment.
Commenting on the results, Dato' Seri Ahmad Zubir Murshid, President & Group Chief Executive of Sime Darby, said: “Although we are pleased with the Q1 results, we are aware that going forward, global economic growth is expected to weaken significantly. Hence, FY08/09 will be a very challenging year for Sime Darby especially for the plantation, property and motors divisions. Nevertheless, Sime Darby’s portfolio of stable cash flow assets as well as growth businesses provides the right balance for the Group to weather the full impact of the economic down cycle.’’
Dato' Seri Ahmad Zubir noted that in these challenging times, managing costs will also be critical particularly in the Plantation Division. As such, Sime Darby has embarked on a cost savings initiative which includes consolidating its support services and reprioritising spending on non-essentials.
On the flip side, the more challenging economic environment will provide Sime Darby with significant investment opportunities. “There will be once in a life time opportunities to acquire undervalued assets particularly with our strong balance sheet. In addition, the economic downturn will also provide an excellent opportunity for us to acquire human resource talent,” he said.
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