UMW Holdings net loss widens in Q2

PETALING JAYA:UMW Holdings Bhd saw its net loses widen significantly for the second quarter ended June 30, to RM209.30 million from RM12.13 million in the same period a year ago, on operating expenses outstripping revenue and higher losses from its listed oil and gas division, UMW Oil and Gas Corp Bhd, which is to be demerged from the group.

UMW Holdings registered losses of almost RM54 million for the second quarter ended June 30, 2017 from continuing operations, comprising of the automotive, equipment, manufacturing and engineering and the unlisted oil and gas arm.

Revenue for the quarter inched slightly higher by 2.54% to RM2.79 billion from RM2.72 billion in the preceding year's corresponding quarter.

"Following the completion of the demerger of UMW-OG, the group is better positioned to focus on the growth of the remaining three core businesses, automotive, equipment, and manufacturing and engineering with a stronger financial footing. Upon completion of the strategic plans of exiting the unlisted oil and gas assets, performance of the group is expected to be improved," its board of directors said in a Bursa Malaysia filing.

Going forward, the board expects the automotive segment to remain competitive for the remainder of the year, while the equipment sector appears to be posing a satisfactory outlook.

As for the manufacturing and equipment segment, the aerospace business with Rolls-Royce is progressing on schedule as first delivery is expected in the last quarter of the year.

The board said, upon completion of the strategic plans of exiting the unlisted oil and gas assets, performance of the group is expected to be improved.

The group fell into the red for the first six months of the current financial year after recording a net loss of RM189.14 million against a net profit of RM4.45 million in the same period last year.

Its revenue rose by 14.22% in the cumulative period under review to RM5.51 billion from RM4.83 billion registered for the same period in the previous financial year.

UMW's shares gained 1.05% to close at RM5.75 with some 203,300 shares changing hands. Its market capitalisation stood at RM6.65 billion.