MBMR Expansion Plan Firmly On Track Despite Challenging Year
17 Jun 2014
Strategic investments set to secure the Group’s future
Kuala Lumpur, June 17, 2014 – MBM Resources Berhad (MBMR) is confident that its expansion plan remains firmly on track after successfully maintaining the record revenues and profits achieved in the previous year despite a challenging year in 2013.
For the 12-month period ended December 31, 2013, MBMR recorded revenues of RM2,234.3 million and profit before tax of RM194.2 million, down 1.5 per cent and 1.6 per cent respectively from the previous year.
Strong contributions from existing businesses and prudent cost management ensured that the declines were marginal although the Group had to face uncertainties brought about by the May 2013 General Election, intense competition in the automotive market and operational cost pressures.
MBMR group managing director Looi Kok Loon said that existing businesses continued to perform well with profit before tax growing by 9.7 per cent in 2013 and 15 per cent in the first quarter of 2014 even as costs incurred for the expansion plan had to be taken in.
“We have made the necessary investments to secure our future. For example, we saw tremendous opportunities in the aftersales business and have moved decisively to add capacity by upgrading existing service centres and adding three new ones for a total of 46 in 2013.
However, some investments will need a gestation period before we see significant contributions. These include our new alloy wheel plant, which fills a gap in the supply of OEM-quality standard alloy wheels in Malaysia and also has tremendous potential for export as it is designed with the highest specifications for meeting international quality standards,” he said.
MBMR’s investments in network expansion not only increased its capacity and geographical reach that contributed to higher sales but also allowed the Group to leverage on the strong growth in new car sales in the past five years to boost its recurring income contribution from the highly lucrative and defensive aftersales business.
While MBMR’s total vehicles sales in 2013 grew by 4 per cent to 26,586 units, the Group recorded a strong 12 per cent growth in service throughputs to 166,963 units from 149,108 units in 2012.
Hirotako Holdings Berhad, the leading manufacturer of automotive safety restraint products in Malaysia, proved to be a star acquisition as it achieved new record revenues of RM296.7 million in 2013.
Looi added, “We are highly optimistic that the Group is headed in the right direction. With capital expenditures tapering off, we are looking forward to an exciting 2015 when we will be seeing full-year contributions from OMI Alloy, the new Hino Motors Manufacturing plant in Sendayan and the new Perodua plant in Rawang. Hirotako, whose airbag sales grew by 13 per cent last year and seat belts are fitted in 68 per cent of vehicles produced in Malaysia, should also remain a major revenue contributor.”
MBMR, which has been synonymous with the Daihatsu brand since its inception, has evolved into a diverse automotive group that represents some of the biggest international brands in Malaysia. They include commercial vehicle brands Daihatsu and HINO; passenger car brands Perodua, Volvo, Volkswagen and Mitsubishi; and sports tuning brands, ABT and HeicoSportiv, and car-care brand Williams.
MBMR is the leader in every market segment it competes in, with products that range from light, medium and heavy duty trucks and buses to entry-level compact cars and luxury sports utility vehicles.
By 2015, MBMR plans to become one of the leading and most complete automotive groups in Malaysia with a full spectrum of capabilities that include manufacturing and assembly, distribution, retail and dealerships, parts and accessories, body and paint repair and customer services.
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