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Malaysia's Proton Reports Net Loss

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Link: http://news.yahoo.com/s/ap/20050831/ap_on_...HNlYwMlJVRPUCUl

KUALA LUMPUR, Malaysia - Facing intense competition from foreign carmakers, Malaysia's national auto company Proton reported a net loss of 12.4 million ringgit, or $3.3 million, for April-June quarter, its worst quarterly financial results in a year and a half.

Proton Holdings Bhd. said in a statement late Tuesday the poor showing was because of lower sales volume, higher components costs and allowances for doubtful debts. It didn't specify how many cars were sold in the quarter.

The company, Southeast Asia's largest car maker by vehicles produced, posted a net profit of 166.5 ringgit in the same quarter of 2004.

First-quarter revenue rose 6.9 percent on year to 2.05 billion ringgit ($539 million).

The dismal results come as Proton faces new foreign competition as the government lifts protective tariffs on foreign-made cars due to a regional fair trade agreement, Proton domestic market share has dropped to around 44 percent in 2004 from 60 percent in 2002.

The company and its controlling shareholder, government investment company Khazanah Nasional Bhd., are currently considering whether to offer German automaker Volkswagen AG a financial stake and possible management role in Proton.

Proton said the quarterly loss would have been worse if not for $5.9 million in unrealized foreign exchange gains due to the revaluation of a $85.5 million loan.

Proton expressed pessimism about prospects for the financial year ending March 2006, saying late Tuesday it "expects the higher component costs arising from higher steel and oil prices to have an adverse impact."

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$3.3 mil? Thats barely a loss, they just need to play the Lotto more. Tell me when they lose $1.7 billion.
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