KUALA LUMPUR (Feb 23): PETRONAS Chemicals Group Bhd (KL:PCHEM) expects operating conditions in 2026 to remain challenging after reporting a net loss of RM754 million for the fourth quarter ended Dec 31, 2025 (4QFY2025) — marking its fourth straight quarterly loss.

The decline was driven by weaker earnings before interest, taxes, depreciation and amortisation (Ebitda) and higher unrealised foreign exchange losses, a bourse filing showed.

For 4QFY2025, the group posted a net loss of RM754 million, or nine sen per share, versus a net profit of RM519 million, or six sen per share, a year earlier. Quarterly revenue fell 12% to RM6.6 billion from RM7.46 billion.

The O&D division was the main drag, swinging to an Ebitda loss of RM600 million from a profit of RM100 million a year ago, as lower product prices offset higher production volumes despite improved plant utilisation of 92% (up from 89%).

Earnings were further hit by unrealised forex losses from the revaluation of shareholder loans to Pengerang Petrochemical Company Sdn Bhd (PPCSB).

The specialities segment also slipped into the red, recording an Ebitda loss of RM31 million compared with a profit of RM15 million a year ago, pressured by tighter margins, intense competition, and customer inventory drawdowns.

In contrast, the fertilisers and methanol division delivered stable earnings, with Ebitda rising to RM730 million, supported by stronger sales volumes and firmer prices, though gains were partially eroded by the stronger ringgit.

PETRONAS Chemicals declared a second interim dividend of four sen per share for the quarter, payable on March 18.

For the full year ended December 2025, the group posted a net loss of RM2.14 billion, reversing from a net profit of RM1.18 billion a year earlier, as revenue slipped to RM27.5 billion.

The group cautioned that the olefins and derivatives (O&D) market will stay under pressure from new capacity in China and subdued demand.

Meanwhile, the specialities segment is expected to record only modest growth, with softness persisting in construction and automotive end markets.

In contrast, fertiliser demand remains resilient in India and Australia, while methanol supply is anticipated to tighten due to scheduled plant turnarounds in Southeast Asia.

PETRONAS Chemicals said it will continue to reinforce portfolio resilience through asset optimisation, cost competitiveness, and operational efficiency, while maintaining disciplined capital allocation to safeguard margins and cash flow.

At the time of writing on Monday, shares in PETRONAS Chemicals were up one sen or 0.3% at RM3.46, valuing the group at RM27.68 billion. The stock has declined 7.5% over the past one year.