MBM Resources Berhad To Open Jaecoo Dealerships; Reports First Quarter Financial Results

MBM Resources Berhad has announced that it is starting a new partnership with Jaecoo Malaysia as part of its strategy to diversify and strengthen its automotive portfolio. This announcement coincided with the release of MBM Resources’ financial results for the first quarter ending 31 March 2024, which showed promising growth across several key metrics.

MBM Resources, through its wholly-owned subsidiary Federal Auto Holdings Berhad, is set to launch a new dealership with Jaecoo, a new premium brand of SUVs in Malaysia. The first 1S outlet is scheduled to open in June at Menara MBMR in Kuala Lumpur, followed by a 4S outlet in Segambut next year. This strategic collaboration aims to bring Jaecoo’s high-quality, affordable vehicles to the Malaysian market, including its upcoming hybrid and electric models. 

“MBM Resources and Federal Auto are excited to partner with Jaecoo as we believe in their vision of offering high-quality vehicles at affordable prices and their commitment to an electrified future with their coming  hybrid and electric vehicle models. The Jaecoo brand would also complement our current portfolio of selling  entry-level and luxury vehicles, where Jaecoo would be positioned for the mid-market,” according to a company spokesperson.

Expressing its support, Jaecoo Malaysia President, Leo Chen said, “An important part of our commitment for long-term growth in Malaysia is our synergy with like-minded partners. We believe MBM Resources’ and Federal Auto’s legacy and excellence in the automotive industry is a testament to this and further complements our goal to excite customers with the best ownership experience.” 

The partnership with Jaecoo is in line with MBM Resources’ objectives of strengthening its position in the automotive industry. In the first quarter of 2024, MBM Resources reported robust financial performance. Some of the key highlights include:

• Total vehicle sales: 8,061 units, a 30% increase year-over-year.
• Total manufacturing throughput: 2.47 million units, up 10% year-over-year.
• Revenue: RM617.1 million, an 11% increase year-over-year.
• Group profit before tax: RM95.0 million, marginal growth year-over-year.
• PATAMI (Profit after tax and minority interests): RM80.2 million, marginal growth year-over-year.
• Earnings per share: 20.53 sen, marginal growth year-over-year.

“We are off to a promising start in 2024, delivering decent first quarter results driven by robust demand for vehicles in the industry,” said Rizal Mohd Zin, Group Chief Executive Officer of MBM Resources. “Total Industry Volume (“TIV”) was up 5% year-over-year, reflecting the strong spillover of demand from a record TIV in 2023. Correspondingly, MBM Resources’ topline benefited through strong vehicle unit sales and increased manufacturing throughput”

Despite the overall positive performance, Rizal noted that PATAMI showed only marginal growth due to slower growth in results from associates despite the company’s higher growth in operating profit before tax. Furthermore, the absence of a one-off cost recovery recorded in the first quarter of 2023 as well as the model mix also affected the group’s profit growth.

MBM Resources remains optimistic about its future performance and strategic growth initiatives, including the newly announced dealership with Jaecoo, which is expected to enhance its market presence and drive further growth in the automotive sector.