NST Business
KUALA LUMPUR: Solid Automotive Bhd (SAB) will continue expanding its product range by providing the widest range of automotive aftermarket parts and developing new product groups suitable for internal combustion engines and electric vehicles.
Managing director Ker Min Choo said that in anticipating a challenging economic environment ahead in both Malaysian and overseas markets, the company would be increasing efforts to enhance supply chain management, productivity and cost management.
"The company continuously monitors developments in our key overseas markets on the political, economic, and regulatory front.
"We actively promote our products and brand names with a focus on the ASEAN region. Additionally, we will aggressively participate in international automotive exhibitions and implement more focused sales and marketing strategies this year and in 2023, to boost our market presence, promote in-house brands and achieve improved market penetration," he said in the company's annual report filed to Bursa Malaysia.
He said that apart from the current market and economic outlook, uncertainties from the pandemic and an unstable global political and economic environment have risen over the past few years, with events creating a spillover effect on SAB.
He said, nevertheless, despite the uncertain economic conditions, there are still available opportunities and markets that the company can act on.
Ker said the recent China lockdowns and the Russia-Ukraine war led to uncertainties in the supply chain on a global scale.
"Volatilities in, inclusive but not limited to, material prices, material supplies, and currencies are keeping us on our toes.
"SAB will continue to adopt prudent management and precautionary measures, but there can be no assurance that these measures are sufficient to address any future changes in the political, economic, and regulatory environment in the countries involved," Ker said.
SAB, which was incorporated on 12 September 2012, is in the business of
trading and distribution of automotive spare parts and components.
These include automotive electrical parts and components for passenger and commercial vehicles and automotive engine and mechanical parts and components for commercial vehicles.
As of the end of the financial year (FY) 2022, the company has 30 locations/branches/outlets throughout Malaysia and one subsidiary in Singapore.
For FY22, SAB's revenue decreased to RM298.36 million, a decrease of 1.9 per cent from RM304.21 million posted in FY21.
The decrease in revenue was predominantly from international sales.
Revenue contribution decreased from RM54.67 million in FY21 to RM40.85 million in FY22, a decrease of RM13.82 million or 25.3 per cent, mainly due to an impromptu surge in demand in FY21 and changes in market conditions.
Domestic sales increased to RM257.50 million in FY22, an increase of RM7.96 million or 3.2 per cent compared to RM249.53 million in FY21, primarily contributed by new products and customer groups.
Profit before tax (PBT) for FY22 was RM8.72 million, a decrease of RM8.61 million compared to a PBT of RM17.34 million in FY21, mainly due to the absence of extraordinary items, performance incentives, warranty and expected credit losses.
Borrowings from financial institutions increased by RM25.92 million, from RM22.26 million to RM48.18 million, as of the end of FY22, mainly due to RM20 million Danajamin's 4-year term loan and increased trade financing for working capital purposes.
SAB's debt-to-equity ratio stood at 0.083 times at the end of FY22 compared to -0.071 times at the end of FY21.