Latest Quarterly Results

Condensed Consolidated Statements Of Profit Or Loss And Other Comprehensive Income
For The Quarter Ended 31 December 2024 - unaudited

The above condensed consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the audited financial statements for the year ended 31 December 2023 and the accompanying explanatory notes attached to these interim financial statements.

Condensed Consolidated Statements Of Financial Position
As At 31 December 2024 - unaudited

*Net assets per share is calculated based on total share capital in issue less treasury shares of 6,105,700.

The above condensed consolidated statement of financial position should be read in conjunction with the audited financial statements for the year ended 31 December 2023 and the accompanying explanatory notes attached to these interim financial statements.

Operating Segments Review

Statement of Financial Position

The Group's financial standing remained robust with shareholders' fund of RM1.5 billion and a net cash position of RM300.1 million as at 31 December 2024 (i.e. cash and cash equivalents plus other investments (current assets) and less bank borrowings). The Group's current ratio (i.e. Current Ratio = Current Assets/Current Liabilities) improved from 2.47 times to 2.52 times mainly due to the increase in cash and cash equivalents following the IMTN issuance.

The net assets per share of the Group increased from RM7.31 as of 31 December 2023 to RM7.36 as of 31 December 2024, mainly due to net profits achieved for the year, which was offset by the unfavourable effects of foreign currency translation for the Group's foreign subsidiaries and joint ventures.

Statement of Cash Flow and Capital Expenditure

For the current quarter ended 31 December 2024, the Group recorded a net increase in cash and cash equivalents of RM49.7 million from RM478.7 million as of 31 December 2023 to RM528.4 million as of 31 December 2024. The positive cash flow movement was attributed to the following factors:-

1. Net cash generated from operating activities of RM55.6 million that was mainly driven by pre-tax profit of RM153.5 million and offset by unfavourable changes in working capital mainly due to higher trade and other receivables balance in line with the higher revenue recorded during the quarter under review and down payments made to suppliers, the latter due to goods being shipped out after the end of the current reporting period.
2. Net cash used in investing activities of RM144.3 million was mainly for the investments in unit trust of RM105.1 million, the acquisition of a land in Indonesia amounting to RM24.1 million, the purchase of tooling, machineries and equipment amounting to RM34.0 million and the Group's investment in an associate in Malaysia amounting to RM4.6 million, offset by dividend received from a joint venture and associate amounting to RM6.2 million and proceeds of RM18.0 million from the disposal of a property in USA; and
3. Net cash generated from financing activities of RM148.5 million mainly due to the issuance of RM200.0 million of IMTN during the previous quarter, offset by the payment of dividend to owners of the Company totalling RM41.1 million and payment of dividend to non-controlling interests amounting to RM28.0 million.

As of 31 December 2024, the Group's capital commitment stood at RM23.9 million comprising primarily the Group's investment in tooling, machineries/equipment and development costs for the supply of parts for new vehicle models and the upgrading of production facilities. The capital commitment is funded internally and through bank borrowings.

The Group recognizes that the retention of sufficient cash reserves is essential in the pursuit of growth and expansion. Thus, the Group's liquidity remains intact as the balance of Islamic Medium-Term Notes of up to RM1.25 billion in nominal value, as of the date of this report, can be utilized for future capital investment, if and when required.

Analysis of Performance of All Operating Segments

Q4'2024 vs. Q4'2023

For the current quarter ended 31 December 2024, the Group recorded revenue of RM590.0 million, an increase of 25.4% compared with revenue of RM470.5 million in the corresponding quarter ended 31 December 2023. The higher revenue in Q4'2024 was largely driven by the strong demand from the domestic OEM segment, coupled with the commencement of supply for certain new models launched in Malaysia since Q2'2024.

In line with the higher revenue, the Group's profit before tax ("PBT") increased from RM34.6 million in the corresponding quarter ended 31 December 2023 to RM54.6 million in the current quarter ended 31 December 2024. The higher PBT was further contributed by the revaluation gain from investment properties, favourable forex movement which resulted in the reversal of unrealized forex loss recognized in Q3'2024 and upward price adjustment claim received from certain customers.

Year-to-date 2024 ("YTD 2024") vs Year-to-date 2023 ("YTD 2023")

For the year ended 31 December 2024, the Group recorded higher revenue of RM2.08 billion, representing an increase of RM152.8 million or 7.9% compared with revenue of RM1.93 billion in the same period of last year. The improved performance was mainly due to the same reasons explained above and further contributed by the growth in export sales due to improved market conditions.

In line with the higher revenue, the Group's PBT increased to RM153.5 million (YTD 2023: RM108.3 million) due to the same reasons explained above, coupled with favourable sales mix, lower production costs due to decrease in certain raw material prices, and the recovery of development costsfor certain model.

Suspension Division

For the current quarter ended 31 December 2024, the Suspension Division recorded a 6.8% decrease in revenue (Q4'2024: RM56.4 million; Q4'2023: RM60.5 million) mainly due to the softening of local REM market and one of the OEM customers which temporarily ceased production during the current quarter for model upgrades. In line with the lower revenue and unfavourable sales mix, the Suspension division registered a LBT of RM1.1 million compared to PBT of RM2.6 million in the corresponding quarter of last year.

For the year ended 31 December 2024, the Suspension Division recorded lower revenue of RM234.6 million (-2.3% compared to the same period last year ("YoY")) mainly due to the same reasons explained above. Despite the lower revenue, PBT increased to RM2.8 million compared to RM1.9 million in the corresponding period. The improved performance was mainly attributable to lower production costs, driven by decrease in raw material and energy prices (natural gas).

Interior & Plastics Division

For the current quarter ended 31 December 2024, the Interior & Plastics Division recorded a 29.0% increase in revenue (Q4'2024: RM492.9 million; Q4'2023: RM382.0 million) mainly due to the commencement of supply for new OEM models since Q2'2024. In line with the higher revenue, PBT improved by 64.2% (Q4'2024: RM49.1 million; Q4'2023: RM29.9 million), further contributed by favourable sales mix and lower production costs resulted from decrease in certain raw material prices and improved operational efficiency.

For the year ended 31 December 2024, the Interior & Plastics Division recorded higher revenue of RM1.65 billion (+8.7%) as against RM1.52 billion recorded in the same period last year. Consequently, PBT increased by 48.2% to RM167.1 million due to the same reasons explained in the paragraph above, including upward price adjustment received from certain customers and the recovery of development expenditures incurred for certain models.

Electrical & Heat Exchange Division

For the current quarter ended 31 December 2024, the Electrical & Heat Exchange Division registered a 5.9% increase in revenue (Q4'2024: RM38.9 million; Q4'2023: RM36.7 million) mainly due to the upward price adjustment and claims received from a customer. In line with the higher revenue, the Division recorded a PBT of RM4.1 million compared to LBT of RM0.5 million in the corresponding quarter of last year.

For the year ended 31 December 2024, the Division recorded higher revenue of RM145.3 million (+5.5% YoY) due to same reason explained above and higher call-ins from certain OEM customers. Consequently, the Division posted a PBT of RM2.8 million compared to LBT of RM4.6 million in the same period last year due to the same reasons explained above.

Marketing Division

For the current quarter ended 31 December 2024, the Marketing Division recorded an increase in revenue by 5.0% (Q4'2024: RM62.6 million; Q4'2023: RM59.6 million) mainly due to strong export sales to North America, Australia and Thailand, offset by a slowdown in demand from domestic REM customers. In line with the higher revenue and reversal of unrealized foreign exchange losses recorded in Q3'24, the Marketing Division registered a higher PBT of RM3.9 million compared to PBT of RM1.5 million in the corresponding quarter of last year.

For the year ended 31 December 2024, the Marketing Division recorded higher revenue of RM273.4 million (+2.2% YoY), due to the same reasons explained in the paragraph above. Despite the higher revenue, the Marketing Division registered LBT of RM0.3 million, compared to PBT of RM9.9 million in the same period last year. This was mainly due to squeezed margins from a competitive business environment and foreign exchange losses resulting from trade receivables denominated in foreign currencies, compared to foreign exchange gains in the same period last year.

Non-Reportable Segment, Malaysia

This segment comprises mainly operations relating to revenue received from sources that include the rental of properties in Malaysia, provision of management services, and engineering and research services for companies within the Group. Revenue generated from these services and sources form part of the intersegment elimination for the total Group's results (as depicted in Note A9). This segment also comprises the Group's investment and participation in associate.

For the current quarter ended 31 December 2024, this segment's revenue increased by 39.1% to RM15.5 million from RM11.1 million in Q4'2023, mainly due to higher inter-group billing of services. In line with the higher revenue and a revaluation gain arising from the revaluation exercise carried out on the Group's investment properties, this segment recorded a PBT of RM0.7 million compared to LBT RM1.2 million in the corresponding quarter of last year.

For the year ended 31 December 2024, this segment's revenue increased by 12.8% to RM52.2 million from RM46.3 million in 2023, mainly due to higher inter-group billing of services. Despite the higher revenue, LBT for the segment widened to RM11.3 million compared to LBT RM6.8 million in the same period last year. The higher LBT was mainly due to the charge-out of certain development expenditures, higher provision for employee benefits and higher finance costs following the issuance of RM200 million IMTN in Q2'2024.

Indonesia Operations

Indonesia Operations refer to the manufacturing and supply of suspension products such as coil springs, shock absorbers and leaf springs as well as the Group's investment and participation in joint ventures and associate in Indonesia.

For the current quarter ended 31 December 2024, the Indonesia Operations recorded revenue of RM24.2 million, an increase of 20.4% compared to RM20.1 million in the same quarter last year. The increase in revenue was primarily due to the start of supply to a new OEM customer. Despite the higher revenue, the Indonesia Operations recorded a lower PBT of RM2.4 million compared to PBT of RM3.3 million in the corresponding quarter of last year. The decrease was mainly attributable to lower share of profit from the Group's joint ventures. In Q4'2023, one of the joint venture companies received an upward price adjustment from its customer, which was partially offset by higher provisions for doubtful debts and slow-moving inventories.

For the year ended 31 December 2024, Indonesia operations recorded higher revenue of RM89.0 million (+1.7% YoY), driven by the same factors explained above. In line with the higher revenue, PBT for Indonesia improved to RM4.6 million compared to PBT of RM1.5 million in the same period last year. The improved performance was further supported by higher gross margins arising from a favourable sales mix and lower material costs. Additionally, the Indonesia Operations recorded a write-back in provision for doubtful debts following settlement with certain customers.

All Other Segments

This business segment refers to the Group's operations in Thailand, Vietnam, Australia, the United States of America ("USA"), the Netherlands and Myanmar ("Operations Outside Malaysia").

For the current quarter ended 31 December 2024, Operations Outside of Malaysia recorded revenue of RM32.5 million (+0.4% compared to the same period last year), mainly due to improved market conditions for bus and train seats in Australia operations. Despite the higher revenue, this segment recorded a wider LBT of RM4.0 million (Q4'2023 LBT: RM0.4 million), mainly due to lower contributions from Vietnam operations as certain OEM model had ended production during the current quarter. Additionally, in Q4'2023, Vietnam operations recorded an one-off income from a favourable outcome related to a duties refund claimed from the Vietnamese Customs. Furthermore, certain operations had written down their inventories to net realizable value.

For the nine months ended 31 December 2024, this Segment recorded a decrease in revenue to RM120.3 million (-2.8% YoY) mainly due to the slowdown in Vietnam automotive industry which affected the OEM demand for both commercial and passenger vehicles. In line with the lower revenue, coupled with the escalating operating cost in Australia operations and provision made for slow moving inventories in certain operations, this segment registered higher LBT of RM8.9 million compared to LBT of RM4.4 million in the previous corresponding period.

Commentary On Prospects and Targets, Strategies and Risk

APM is principally involved in the design, manufacturing, assembly and production of automotive and mobility components. The Group's main operations are located in Malaysia, but it is also present in various other jurisdictions, including the United States of America (U.S.), the Netherlands, Australia, Thailand, Vietnam, the Republic of Indonesia and the United Kingdom.

The total industry volume ("TIV") in Malaysia for 2024 recorded 816,747 vehicles sold, marking the third consecutive record year since 2022. This represents a 2.1% increase compared to the previous record of 799,821 vehicles sold in 2023. The strong TIV performance was mainly driven by the resilient domestic economy, stable interest rate and the introduction of new models launches. Looking ahead, the Group anticipates that the TIV in Malaysia for 2025 will moderate, primarily due to the absence of key drivers to sustain the current high sales levels. This aligns with the Malaysian Automotive Association's (MAA) forecast of a 4.5% decrease in TIV for 2025, projected at 780,000 units.

The Group expects continued challenges in the domestic REM segment, which will likely face pressure from stiff competition posed by imported goods and products. On the other hand, the Group plans to expand its export segment, with a focus on key markets such as the United States, Australia, and Europe.

For its overseas operations, the Group anticipates gaining greater traction and momentum in 2025, following a challenging year in 2024. Indonesia remains a key market poised to drive growth in the Group's overseas operations. The increasing presence of Chinese carmakers in Indonesia could provide a boost to the automotive industry there.

The Group is fully aware of the challenges facing the global economy. Geopolitical tensions remain elevated, and any further escalation could lead to renewed stress in financial markets and significant disruptions to the global economy. Domestically, the impending subsidy rationalization for petrol, along with inflationary pressures, may dampen consumers' willingness to make large purchases.

In light of the current challenges, the Group will maintain a cautious and prudent approach to its business operations, given the ongoing uncertainties in the market. Moving forward, the Group will stay focused on executing its 5-year strategic plan aimed at ensuring long-term business sustainability, while consistently delivering value to shareholders.