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Quarterly Results

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Quarterly Report For The Financial Period Ended 30 September 2017

Condensed Consolidated Statement Of Profit Or Loss For The Quarter Ended 30 September 2017

Statement Of Profit Or Loss For The Quarter Ended 30 September 2017

Condensed Consolidated Statement Of Financial Position As At 30 September 2017

Financial Position Quarter Ended 31 March 2017

Analysis Of Performance Of All Operating Segments

The Group's revenue decreased by 19.5% with loss before taxation (LBT) of RM85.4 million for the quarter ended 30 September 2017 (-56.7% YoY). The financial position of the Group has improved whereby the inventory has reduced to RM1,331 million (-23.9% YoY) and the corresponding Group net cash in-flow generated from operating activities showed RM268 million as the Group undertook measures to have better inventory holding management to ensure a sustainable financial position. Receivables have also improved with better management of receivables collection with RM111.3 million (+24.6% YoY). As at 30 September 2017, the Group's retained earnings was RM1.76 billion while the net assets per share was at RM4.27. Further analysis on the segments are explained as follows:

  1. Vehicles Assembly, Manufacturing, Distribution & After Sales Service (automotive)

    The automotive division recorded lower revenue of RM3,201.9 million (-20.0% YoY) with segment EBITDA of RM48.7 million (-27.2% YoY). The lower revenue and EBITDA was due to stiff competition from other market players which has affected new vehicles sales but mitigated by better performance from the after sales services and spare parts business. The unfavourable foreign exchange rates which impacted the cost of imported parts and components for new vehicles that could not be fully passed on to consumers continue to affect the profit margin of assembly and sales of new vehicles. The Nissan brand vehicles in Malaysia maintained its third place position in the non-national car segment with 5% of the total industry volume.

  2. Financial Services (hire purchase and insurance)

    The financial services division recorded higher revenue of RM57.3 million (+27.7% YoY) and EBITDA of RM15.4 million (+11.9% YoY). The increase was due to higher hire purchase loans disbursed to provide additional credit support to vehicle purchasers. Hire purchase loans disbursed were RM406.3 million (+17.3% YoY).

  3. Other Operations (investments and properties)

    Revenue from other operations was lower at RM6.0 million compared to RM8.6 million in the previous year and LBITDA was at RM1.3 million compared to EBITDA of RM18.6 million in the previous year. The lower revenue recorded was due to reduction of revenue from the provision of information technology services, trading business and education services. The LBITDA recorded was due to the net foreign exchange loss of RM13.3 million which was mainly arising from financing overseas entities denominated in foreign currencies.

Current Year Prospects

The Group continues to face a challenging market as it operates in competitive business environment with unfavorable foreign exchange impact which cannot be passed on to consumers. TCMH Group maintains its cautious stand under the current market outlook.

Nonetheless, the Group will continue to create better marketing strategies to improve sales momentum and focus on improving the Group's liquidity by improving inventory holding. Over the years, the Group has invested and continue to invest to improve the sales and after-sales services network throughout Malaysia to boost the sales and distribution infrastructure as an effective way to reach out to the more discerning customers of today.

The Group's regional expansion programme remains on course as we continue to strengthen our presence in Cambodia, Laos, Myanmar and Vietnam by expanding our sales network and optimising our existing plant utilisation. All these measures will strengthen the Group with a stronger financial footing moving forward.