DRB-Hicom records RM540.1 million profit in 2020 – boosted by Proton, auto business, SST exemption
DRB-Hicom Berhad has announced that it recorded a profit before tax of RM540.1 million for the financial year that ended December 31, 2020. This is on the back of RM13.2 billion revenue, assisted by a moderate business recovery in the second half of last year and the completion of an asset disposal exercise.
As it was the first full year of a revised financial period for the conglomerate, no comparable quarterly or annual figures are available. For Q4 2020, the group’s revenue was RM4.85 billion, with EBIT of RM948.8 million. For both Q4 and FY2020, the majority of DRB-Hicom’s revenue came from the automotive sector.
DRB-Hicom has a 51% share in Proton, which ended last year second in the sales charts. The company also has stakes in the local arms of Honda (the top non-national marque, No.3 overall), Mitsubishi and Isuzu; and has dealerships for Audi, Isuzu, Mitsubishi and Volkswagen.
For the automotive sector, DRB benefited from the government’s decision to declare a sales tax holiday for passenger vehicles. Revenue was RM8.0 billion for FY2020, with Q4 being the best quarter of the year with RM2.6 billion worth of sales, up 3% year-on-year. The services and property sectors contributed RM3.5 billion and RM1.3 billion respectively to the group’s revenue in 2020. DRB-Hicom has now exited the hospitality industry.
Looking ahead to FY2021, the automotive business will continue as a key growth driver for DRB-Hicom. With the extension of sales tax exemption for passenger cars until June 30, the Malaysian Automotive Association is optimistic that the local car market will rebound this year, with projected total industry volume (TIV) rising to 570,000 units (529,434 units in 2020).
DRB-Hicom says that the expected introduction of facelifted variants and aggressive promotional campaigns by various marques under its umbrella will also boost its automotive business this year. If Proton continues its rise (2020 market share was 20.5%, up from 16.6% in 2019 and 11% in 2018, its lowest ever) and Honda prevails against Toyota (controlled by fellow conglomerate UMW) in the non-national duel, DRB-Hicom will have a strong FY2021 to report.
The post DRB-Hicom records RM540.1 million profit in 2020 – boosted by Proton, auto business, SST exemption appeared first on Paul Tan's Automotive News.
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