Hong Leong Asia net profits down 27% to S$30.8m in H1

Weaker RMB to SGD exchange rates weighed on revenue.

Hong Leong Asia (HLA) saw its profits and revenue decline in the first six months of 2023, which it blamed on weaker foreign exchange and higher costs.

Net profit attributable to shareholders dropped 27.72% to S$30.8m during the period, notably impacted by the absence of a one-off gain from disposal of assets held-for-sale in H1 2022.

Earnings per share is S$4.12, down 27.6% from S$5.59 declared last year.

Revenue also dipped by 1% to S$2.1b in H1, compared to a year earlier. Hong Leong Asia said that this was due to the translation effects of a weaker RMB against SGD. This was partially mitigated by revenue growth from the building materials unit (BMU) in Malaysia. 

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Other areas of business are also showing signs of improvement and growth. HLA’s powertrain solutions unit in China, Yuchai, recorded improved H1 results as market recovers gradually from the pandemic restrictions. Profit after tax is S$48.1m, a 60.5% growth compared to the previous year.

However, Yuchai’s revenue still declined by 2.4% to S$1.8b compared to a year ago. Total number of engines sold fell by 8.4% to 165,793 units, but higher operating margins on better sales mix towards bus, agricultural and industrial markets — along with better performance from associates and joint ventures — helped boost Yuchai’s net profit, HLA said.