Sime Darby 3Q net profit slumps 45% to RM193m on weaker industrial, motors performance

SIME Darby Bhd saw a 44.7% drop in net profit from continuing operations to RM193 million for the third quarter ended March 31, 2025 (3Q25), from RM349 million a year earlier, weighed down by weaker earnings across all core divisions.

Quarterly revenue also fell 13% year-on-year to RM16.3 billion.

No dividend was declared for the quarter.

The industrial division’s earnings were impacted by currency volatility, bad weather, and a softer Australian dollar affecting its Australasia operations.

The motors division recorded lower profit and revenue in Malaysia, Hong Kong, and New Zealand. UMW Holdings Bhd, acquired last year, saw its profit decline by 26% due to losses in its lubricants segment.

Despite the challenging market conditions and rising competition from Chinese automotive brands, group CEO Datuk Jeffri Salim Davidson said Sime Darby remains focused on cost discipline and operational efficiency.

These efforts contributed to a RM1.7 billion boost in operating cash flow for the nine-month period (9M25).

Group net profit for 9M25 dropped nearly 60% year-on-year to RM1.3 billion from RM3.2 billion, which had included a RM2 billion one-off gain from the Ramsay Sime Darby Health Care divestment. However, revenue rose 8.2% to RM52.3 billion.

Sime Darby cautioned that the global economic outlook remains highly uncertain, particularly following the US’s announcement of new tariffs on most countries.

Heightened financial market volatility has also affected exchange and interest rates, creating headwinds for its industrial and motors businesses.

Nevertheless, the group remains optimistic about medium- to long-term demand from Australia’s mining sector, which continues to support demand for its products and after-sales services.

However, Sime Darby expects its core financial performance for the financial year ending June 30, 2025, to be lower than the previous year’s. — TMR