SINGAPORE (Nov 7): Jardine Cycle & Carriage (JC&C), a holding company of Jardine Matheson, announced that its earnings have nearly doubled to US$729 million ($991 million) for the 9M19 ended September, from US$374 million in 9M18.
However, the surge was mainly due to net non-trading gains of US$115 million from unrealised fair value gains related to non-current investments. For the same period last year, there were net non-trading losses of US$300 million from unrealised fair value losses on these investments.
Stripping the effect of these non-trading items, the group’s underlying earnings for 9M19 were 9% lower at US$614 million, compared to US$674 million in the previous year.
9M19 revenue dipped 1% to US$13.91 billion, from $13.98 billion last year, reflecting the challenging conditions faced by Astra in Indonesia and Truong Hai Auto Corporation in Vietnam.
Astra contributed US$536 million to JC&C’s underlying profit, 8% lower than the same period last year with the Rupiah exchange rate being stable. The lower contribution was mainly due to lower contributions from its automotive and agribusiness divisions, which offset higher contributions from the financial services division.
The group’s Direct Motor Interests contributed about US$79 million to the group’s underlying profit, 24% lower than the prior year, mainly due to smaller contribution from Thaco. This was due to a decline in vehicle sales in the face of the intense competition in the completely-built-up import segment, as tariffs were eliminated following the full implementation of the Asean Trade in Goods Agreement in 2018.
Cycle & Carriage Bintang in Malaysia registered a loss of US$2 million, compared to a profit of US$1 million in 2018, when the business benefited from the one-off zero rate of GST from June to August 2018.
The lower underlying profit from the Direct Motor Interests was partially offset by higher contribution from Cycle & Carriage Singapore and Tunas Ridean in Indonesia.
Meanwhile, Other Strategic Interests contributed US$59 million to the Group’s underlying profit, 6% up on the previous year, mainly due to higher contribution from the group’s investment in Vinamilk.
As at end September, cash and cash equivalents stood at US$1.89 billion.
Ben Keswick, chairman of JC&C says, “Astra is expected to continue to be affected by relatively weak domestic consumption and low commodity prices for the remainder of the year, while benefiting from an improved contribution from financial services and its gold mine operations. JC&C’s Direct Motor Interests are expected to continue to face challenging market conditions, while the contribution from Other Strategic Interests is expected to be stable.”
Shares in JC&C closed 2.3% lower at $32.59 on Thursday.
