KUALA LUMPUR: Sime Darby Bhd is exploring opportunities to monetise its RM2.4 billion investment in the logistics business in Shandong, China.
Group chief executive officer Jeffri Salim Davidson said its investment in Shandong comprised Weifang Sime Darby Port, three river ports and a water treatment plant.
“Monetising basically means we are taking money out of the business, selling part of it.
“Listing is probably a bit difficult because it is too small to be meaningful,” he said at a briefing on the company’s first-half financial year 2018 results yesterday.
He, however, declined to disclose details except to say that Sime Darby had yet to speak to any party on the monetisation plan.
Meanwhile, Sime Darby is upbeat on maintaining its robust growth in the industrial and motor divisions for the financial year 2018 driven by encouraging performances in the previous quarters.
He said the industrial and motors divisions would primarily be spurred by healthy mining activity in Australia and launches of new BMW models.
“We believe these businesses will continue to generate significant revenue for the company. However, other sectors like logistics and healthcare growth are expected to be moderate,” he said at a press conference here today.
Jeffri said the industrial division was mainly involved in sales and rental, as well as, parts and maintenance of Caterpillar and other machinery products.
On the motor division, Jeffri said Sime Darby Bhd would start producing BMW engines next month at its Inokom Plant in Kulim, Kedah.
“The new engine plant is located within our existing facility with an annual production capacity of 10,000 engines for both local and export markets,” he said, adding that BMW marquee contributed between 60 per cent and 70 per cent of its motor division.
Sime Darby Bhd’s net profit for the second quarter ended Dec 31, 2017 fell 51.5 per cent to RM344 million compared with RM709 million chalked up in the previous corresponding quarter.
Revenue for the quarter, however, was higher at RM8.81 billion versus RM8.09 billion recorded a year ago.
For the six-month period, net profit rose 34.9 per cent, year-on-year, to RM1.74 billion while revenue jumped to RM16.95 billion against RM15.02 billion registered in the matching period of 2016. — Bernama