Friday 02 Jun 2023
By /
main news image

KUALA LUMPUR (Aug 25): Petronas Chemicals Group Bhd's (PetChem) second quarter net profit jumped 10-fold to RM1.86 billion from RM186 million a year earlier as revenue rose largely due to higher product prices in tandem with the recovery of crude oil price as investors weighed a supply shortage of the commodity against its demand recovery at a time when the Covid-19 pandemic affected the global economy.

In a Bursa Malaysia filing today, PetChem said revenue rose to RM5.61 billion in the second quarter ended June 30, 2021 (2QFY21) from RM3.18 billion.

PetChem declared its first interim dividend of 23 sen a share for 2QFY21.

PetChem said its crude oil-based products include olefins, fertilisers and methanol.

"The results of the group's operations are expected to be primarily influenced by global economic conditions, petrochemical products' prices which have a high correlation to crude oil price, particularly for the olefins and derivatives segment, utilisation rate of our production facilities and foreign exchange rate movements.

"The utilisation of our production facilities is dependent on plant maintenance activities and sufficient availability of feedstock as well as utilities supply," PetChem said.

For 1HFY21, PetChem said cumulative net profit climbed to RM3.32 billion from RM692 million a year earlier while revenue grew to RM10.28 billion from RM7.07 billion.

On a quarterly basis, PetChem said 2QFY21 revenue increased 20% to RM5.61 billion largely attributable to higher sales volume and product prices.

"Profit after tax was higher by RM390 million or 27% at (about) RM1.9 billion in line with higher EBITDA (earnings before interest, taxes, depreciation, and amortisation) and net share of profit from joint venture and associates," the company said.

Moving forward, the group said it will continue with its operational excellence programme and supplier relationship management to sustain plant utilisation level at above industry benchmark.

"The Covid-19 pandemic continues to affect the global economy and the market will remain volatile. Petronas Chemicals will navigate market uncertainties by leveraging its operational and commercial excellence.

"The group anticipates petrochemical product prices to remain stable in the coming quarter, amid continued reduced supply and demand recovery," it said.

Looking back, PetChem said today the group recorded lower plant utilisation rate of 97% in 2QFY21 compared with 100% a year earlier mainly due to higher level of statutory turnaround activities resulting in slightly lower production and sales volumes.
For 1HFY21, the group said plant utilisation fell to 94% from 97% a year earlier mainly due to higher level of statutory turnaround activities undertaken, resulting in lower production and sales volumes.

"(In quarterly terms, Petronas Chemicals) recorded improved plant utilisation rate, production volume and sales volume as compared to the preceding quarter mainly due to lower level of maintenance activities," the group said.

At 2.32pm today, PetChem's share price rose five sen or 0.63% to RM7.99, which gives the company a market capitalisation of about RM63.92 billion.

PetChem has eight billion issued shares, according to its latest quarterly financial report.

Edited ByChong Jin Hun
      Text Size