Sime Darby

Sime Darby Reports 113% Increase In Pre-Tax Profit In Third Quarter

Press Release

Group’s pre-tax profit for the first three quarters hits RM3.8 billion

KUALA LUMPUR, 28 May 2008 – Sime Darby Berhad’s pre-tax profit surged 113% in the quarter ended 31 March 2008, pushing the group’s pre-tax profit for the first three quarters to RM3.8 billion.

For the first three quarters of the year, the Group's solid performance was mainly due to the strong showing of the Plantation Division. The Plantation Division registered an increase in operating profit of 148% to RM2.8 billion during the three quarters, driven by better production yield, merger synergies and continued strong CPO prices. The Motors Division maintained its turnaround momentum with operating profit of RM182 million, as compared to RM21 million last year.

However, the Property Division’s operating profit dropped by 22% to RM239 million. Given the uncertain outlook for the sector, the Group expects that the Property Division will enter a more challenging period for the rest of the financial year.

Sime Darby realized RM160 million in merger synergies in the plantation and property businesses against RM28 million targeted for FY2008. Under the merger exercise, the Group announced that it would be able to achieve post-merger synergies of RM400-500 million by FY09/10.

Commenting on the results, Dato’ Seri Ahmad Zubir Murshid, President & Group Chief Executive, said “I am particularly pleased with the results as this had been achieved under very tough global macroeconomic conditions. The performance is also testament to the company’s continued effort to deliver the synergies from the merger.”

He also paid tribute to the employees of Sime Darby for their hard work and dedication in ensuring that efforts to achieve the merger synergies remain on track.

Despite the increasingly challenging global macroeconomic outlook, the Group remains optimistic that the company’s global strength, diversity of markets and business portfolio makes it well-positioned to deliver consistent long-term performance.

For the Group, in the first three quarters ended 31 March 2008, revenue grew by 22% to RM24.9 billion while net profit after tax and minority interest rose by 42% to RM2.5 billion.