KUALA LUMPUR (Sept 4): Petroliam Nasional Bhd (Petronas) posted a loss after tax of RM21 billion for the second financial quarter ended June 30, 2020 (2QFY20) due to a sharp contraction in oil demand by as much as 22 million barrels per day in April, no thanks to the Covid-19 pandemic.

The quarterly loss was also widened by a net impairment of RM20.77 billion, compared with a write back of RM179 million a year ago, due to the collapse in oil prices.

The quarterly loss is the first since 4QFY15. The latest quarterly loss is in contrast to a net profit of RM14.7 billion a year ago and RM4.52 billion for the preceding quarter (1QFY20).

Quarterly revenue dropped 42.4% to RM34.03 billion, compared with RM59.1 billion for 2QFY19. The national oil firm's revenue also declined for two consecutive quarters. Its quarterly revenue fell from RM53.5 billion for the January-March quarter this year and RM64 billion for 4QFY19.

On the other hand, the national oil firm posted earnings before interest, taxes, depreciation and amortisation (Ebitda) of RM29.4 billion for 2QFY20, compared with RM54.7 billion a year ago.

For the first half ended June 30, 2020 (1HFY20), Petronas posted a net loss of RM16.5 billion versus RM28.9 billion for the previous corresponding period.

Cumulative revenue fell 22.7% to RM93.6 billion from RM121.11 billion for 1HFY19.

Despite the net loss, the national oil firm generated an operating cash flow of RM26.26 billion in 1HFY20. Its cash pile stood at RM156.86 billion as at June 30.

Speaking during the quarterly results briefing, Petronas' newly appointed president and group chief executive officer (CEO) Tengku Muhammad Taufik Tengku Aziz pointed out that the group's annual earnings will be "severely affected" by the Covid-19 outbreak.

Petronas is not the only player in the oil and gas (O&G) industry that has suffered from massive impairments on asset values. Large asset impairments as a result of the slump in crude oil prices have been common among international oil majors, such as Exxon Mobil Corp and Shell, for the second quarter.

Tengku Muhammad Taufik said demand might recover to pre-pandemic levels in the second half of next year, but stressed that the prospect remains uncertain.

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