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Quarterly Report For The Financial Period Ended 30 September 2024
Condensed Consolidated Statement Of Profit Or Loss For The Quarter Ended 30 September 2024
Condensed Consolidated Statement Of Financial Position As At 30 September 2024
Analysis Of Performance Of All Operating Segments
For the quarter ended 30 September 2024, the Group recorded revenue of RM462.7 million, a reduction of 28.8% compared to the same period preceding year, mainly due to softer consumer sentiments and a highly competitive business landscape in the local and overseas markets. As a result of the lower revenue and higher net foreign exchange loss of RM53.2 million compared to a lower foreign exchange loss of RM6.2 million recorded in the same period preceding year, the Group recorded a Loss Before Tax ("LBT") of RM103.8 million in the current quarter under review, compared to LBT of RM52.3 million in the same period preceding year.
For the nine months ended 30 September 2024, the Group recorded revenue of RM1.6 billion, 16.8% lower than same period preceding year resulting in LBT of RM162.2 million in the current year-to-date period, compared to LBT of RM57.8 million in the same period preceding year. The increase in losses was mainly due to lower revenue and higher net foreign exchange loss of RM48.0 million compared to a net foreign exchange gain of RM32.2 million recorded in the same period preceding year.
As of 30 September 2024, the Group's retained earnings were RM1.38 billion. The net assets per share as of 30 September 2024 was lower at RM3.93, compared to RM4.20 as of 31 December 2023. Further analysis of the performance of the business segments is as follows:
- Vehicles Assembly, Manufacturing, Distribution & After-Sales Services ("Automotive")
The automotive division recorded lower revenue of RM438.9 million in the current quarter under review, a reduction of 25.8% compared to the same period preceding year ("YoY"). The decrease in sales was mainly due to stiffer competition in local and overseas markets. Loss Before Interest, Tax, Depreciation and Amortisation ("LBITDA") of RM7.5 million was lower by 61.8% YoY, despite registering lower revenue during the current quarter under review mainly due to higher net foreign exchange gain.
For the nine months period ended 30 September 2024, the automotive division recorded revenue of RM1,498.4 million (-16.1% YoY) and LBITDA of RM1.8 million (-104.3% YoY), mainly due to lower revenue.
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Financial Services (Hire Purchase and Insurance)
The financial services division recorded revenue of RM17.5 million in the current quarter under review (+9.0% YoY) and EBITDA of RM4.4 million (+27.8% YoY). EBITDA was higher mainly due to higher revenue and lower impairment loss on hire purchase receivables in the current quarter under review compared to the same period preceding year.
For the nine months ended 30 September 2024, the financial services division recorded higher revenue of RM53.0 million (+7.4% YoY) but lower EBITDA of RM11.2 million (-21.7% YoY). The decreased in EBITDA mainly due to higher impairment loss on hire purchase receivables in the current year-to-date period.
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Other Operations (Investments and Properties)
Revenue from Other Operations was lower at RM6.3 million in the current quarter under review (-85% YoY) and recorded a higher LBITDA of RM49.5 million in the current quarter compared to EBITDA of RM7.3 million in the same period preceding year (-781.2% YoY), mainly due to higher net foreign exchange loss in current quarter compared to same period preceding year which arose from transactions and outstanding balances denominated in foreign currencies.
For the nine months ended 30 September 2024, revenue from Other Operations was lower at RM20.1 million (-62.1% YoY) and LBITDA of RM20.7 million was lower by 148.9% YoY. The decrease in EBITDA was primarily due to higher net foreign exchange loss in the current year-to-date period, which arose from transactions and outstanding balances denominated in foreign currencies.
Future Prospects
Malaysia's economy continued to be influenced by global economic pressures and domestic adjustments. Although Malaysia remains on track with GDP growth projections of around 4%, domestic demand and high inflation continue to shape spending behaviour, impacting several sectors, including automotive. The automotive landscape in Malaysia for 2024 shifted and is marked by an ongoing rise in competition, particularly from Chinese brands that are expanding their presence. These brands are offering models with highly competitive pricing and increasing the competitive pressure on local manufacturers. Malaysia's TIV for 2024 is expected to reach 800,000 units driven by on-going promotions from car manufacturers.
In Malaysia, the Group is on track to introduce the All-New Nissan Kicks e-Power in Quarter 4 of 2024. The Nissan Kicks comes with Nissan's e-Power technology that provides the sensation of driving an electric vehicle, without the need to plug in and charge the battery. The Group aspires to offer hightech, high-value products that are competitive and meet the customers' needs. For the first time, we are preparing to produce vehicles in the Malaysia plant and export vehicles to overseas market in collaboration with Nissan Motor Co. Ltd. This is expected to commence in Quarter 4 of 2024. The Group has also planned for other new models to be introduced in the months ahead to stay competitive. We continue to improve customer service touch points progressively across the country. These will be the catalysts for future sales growth in the local market.
In Vietnam, the introduction of the GAC M6 Pro (C Segment-MPV), M8 (Luxury-MPV) and GS8 (D Segment-SUV) marked an exciting step for the Group as it established a stronger foothold in the Southeast Asian market. The GAC vehicles are well-positioned to capture the attention of Vietnam's growing middle class market. We can capitalise on the rising demand for family-oriented vehicles and we continue to receive healthy bookings since their introduction. For the other markets, sales have been promising and are expected to strengthen as we intensify our marketing and promotion efforts.
The Group is implementing several strategic action plans to improve our competitiveness in the countries that we operate. We will continue to focus on accelerating the introduction of new models in the coming quarters, maximising our strategic partnerships and alliances to introduce products with strong brand value proposition to our customers.
Notwithstanding the current highly competitive market conditions, the Group remains positive on the long-term prospects of our businesses, given that we have built strong fundamentals to stay resilient and well-positioned to capitalise on growth opportunities. Moving ahead, the Group's unwavering focus on improving business performance, driving better operational efficiencies, efficient cost management, and cash flow management is expected to place the Group in a better position to deliver long-term operational and financial sustainability.