Friday, October 28, 2011

Cycle & Carriage 3Q earnings down 38% on lower margins

KUALA LUMPUR: Cycle & Carriage Bhd's earnings for third quarter ended Sept 30, 2011 fell 38.37% to RM5.93 million from RM9.62 million a year ago, due to lower margins and reduced non-recurring income.

It said on Friday, Oct 28 that revenue rose 20.6% to RM188.21 million from RM156.03 million. Earnings per share were 5.89 sen compared to 9.55 sen the previous year.

Cycle & Carriage said the persistent intense competition in the premium vehicle segment in Malaysia put pressure on margins resulting in the lower margins.

However, the group said it managed to increase sales of Mercedes-Benz cars by 16%, assisted by the inclusion of sales by Lowe Motors Sdn Bhd. Lowe Motors was acquired in May 2011.

The group's head office costs were lower than the year before and earnings from the group's after-sales activities have also improved.

For the nine months ended Sept 30, 2011, profit fell 8.93% to RM20.29 million from RM22.28 million a year ago. Revenue increased 11.92% to RM519.00 million from RM463.70 million.

Cycle & Carriage chairman Brian Keswick said: "While the impact of the deteriorating global economy on Malaysia is still unclear, the intense competition in the local automotive market is expected to continue putting pressure on sales and margins."

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