Financial Year 2022 ended on 30th June. Sime Darby Bhd recorded a lower net profit in the Financial year. The net profit of Sime Darby for the financial year is RM1.10 billion.
The reduction of the net profit is caused by supply chain disruptions and rising inflations. According to the Chief executive officer of Sime Darby, Datuk Jeffri Salim Davidson, the company will be facing more difficulties in the next financial year (FY23).
Chief executive officer of Sime Darby, Datuk Jeffri Salim Davidson, is optismistic
This is due to the fact that the rising interest rates make it more difficult for the customers to borrow from financial institutions, which in turn reduced customer demand. Datuk Jeffri also stated that China’s Covid-19 lockdown had a negative effect on the group’s revenue.
He said that there will be difficulties in the next financial year, and the group has to put in a lot of effort in order to achieve the desired results.
Despite the challenges, Datuk Jerri is optimistic on FY23, saying that the demand for cars will be strong and there will be a gain for disposing of a piece of land in Labu. The sale of the 760 acres of land is expected to be completed in FY23.
Sime Darby will continue to explore ways to dispose of other non-core assets
The group will continue to explore ways to dispose of other non-core assets to monetize for the group. In FY21, the group gained RM272mil by selling off the stake in Tesco Malaysia. Excluding this gain, the net profit of Sime Darby Bhd declined only marginally by 4.3%.
The industrial and motor business was impacted due to the contraction of the China market due to the COVID restrictions and inventory shortages.
Datuk Jeffri was satisfied with the financial performance of the group as it reported a billion ringgit in profits despite the higher operating costs. Besides, the group’s earnings per share have also improved, jumping from 3.1 sen a year ago to 4.1 in the fourth quarter of FY22.
