Wednesday, February 23, 2011

Tan Chong Motor - 4Q net profit up 21.8% to RM52m, proposes 6c final dividend 2011

KUALA LUMPUR: TAN CHONG MOTOR HOLDINGS BHD [] net profit for the fourth quarter ended Dec 31, 2010 rose 21.8% to RM52.07 million from RM42.73 million a year earlier, boosted by across the board price discounting to clear 2010 inventories ahead of new model introductions in 2011.

It said on Wednesday, Feb 23 revenue for the quarter rose 16% to RM835.36 million from RM720.19 million a year ago. Earnings per share were 7.98 sen, while net assets per share was RM2.57. Tan Chong proposed a final dividend of six sen per share totaling RM29.4 million.

For the financial year ended Dec 31, Tan Chong's net profit rose to RM229.74 million from RM153.32 million last year, while revenue jumped to a record RM3.51 billion from RM2.86 billion.

Reviewing its performance, Tan Chong said on Wednesday, Feb 23 that due to a slower second half, net profit and earnings per share came in at the low end of market expectations.

The slowdown reflects the complexity of transitioning from a higher commercial vehicle sales mix to stronger passenger models, it said.

The all-new Nissan Teana was launched on Nov 23, 2010 and the bulk of sales were recognised at the start of 2011 instead of 2010, it said.

'Overall performance shows a disciplined approach to executing our long-term business plans even as total industry volume peaked,' it said.

On its prospects, Tan Chong said 2011 will be a year of record new model introductions for the group, due in large part to a rigorous marketplace and a more discerning consumer.

'Based on the booking backlog in Q4 2010 and visible showroom traffic, the group remains well positioned to capitalise on both local and regional economic trends.

'As total industry volume matures in Malaysia but grows from a low base in Indochina, the prospect for sustainable expansion is possible if we remain committed and careful,' it said.

Source: The Edge 23 Feb 2011

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