Silver lining for Proton despite economic gloom
Published 20 Nov 2001, 5:56 am
(AFP) The outlook for national car maker Proton remainsbullish despite the economic gloom after it turned in stronger-than-expectedinterim results, analysts said today.
Perusahaan Otomobil Nasional Bhd (Proton) late Mondayannounced a six-fold increase in its net profit to RM382.812 million for thesix months to September, from RM54.335 million in the same period last year.
This was on the back of a 40 percent year-on-year rise insales to 5.297 billion ringgit. Its earnings per share surged to 0.70 ringgitfrom 0.10 rinngit in the same period last year.
The carmaker attributed the improved results to higherdomestic sales in the second quarter.
Proton's impressive showing amid difficult times boosted its shares whichclosed morning trade Tuesday up 0.40 ringgit at 6.30.
An auto analyst with a foreign brokerage said Proton'sresults were 85 percent above his expectations and some 43 percent above marketconsensus.
"The results were very good. We thought there could bea positive surprise in the earnings compared to our rather conservative forecastbut this has really exceeded our expectations," he said.
Bright prospects
The analyst said sales of Proton cars were up some 16-20percent year-on-year and attributed this to a full six months of higher sellingprices for the Iswara and Wira models.
"It was also the impact from the favourable ringgit andyen exchange rate and some cost-cutting measures by Proton," he said.
The analyst said Proton was not likely to repeat its strongfirst half-year results in the second half of the 2002 financial year as saleswere likely to slide amid the economic downturn.
But he said Proton's prospects were bright despite theeconomic gloom.
"Going forward, (the outlook is) even better for Protonwith its new engines and new models," he added.
The analyst said he has revised upwards his 2002 forecast toa net profit of RM612 million, with 2003 net profit estimated at RM760 million.
Proton said today demand for its cars in the lower pricesegment was expected to stay firm and that results for the rest of thefinancial year ending March 2002 would remain "favourable".
"Although the economic outlook for the next six monthsis expected to weaken, the demand for Proton cars in the lower end segment andWaja is expected to remain firm for the rest of the financial year," itsaid in a statement.
"This is expected to contribute favourably to thecompany's results."
More than 65 percent of cars sold in Malaysia today areProton, partly because of high tariffs on imported cars, but this tariffprotection will largely disappear under the ASEAN Free Trade Area (AFTA) by2005.
Post time 1-4-2016 10:43 AM
