KUALA LUMPUR (Aug 19): Gas Malaysia Bhd (KL:GASMSIA) has declared a lower interim dividend after its second-quarter net profit fell 27%, mainly due to lower average natural gas contribution margin and higher costs.

The natural gas distributor declared a first interim dividend of five sen per share, amounting to RM64.20 million, payable on Nov 6. That compares with a first interim dividend of six sen per share, or RM77.04 million, declared a year earlier.

Gas Malaysia's net profit for the three months ended June 30, 2026 (2QFY2026), fell 26.8% year-on-year to RM72.53 million from RM99.12 million. Revenue declined 12.2% to RM1.58 billion from RM1.80 billion.

In its filing with Bursa Malaysia on Wednesday, the group attributed the weaker performance to a lower average natural gas contribution margin arising from a drop in average natural gas selling price, as well as higher operating expenses and finance costs. These were partly mitigated by a higher volume of natural gas sold.

"As the group progresses through the remainder of the financial year, it will continue to focus on enhancing operational efficiency, maintaining cost discipline, and strengthening its competitive position," Gas Malaysia said.

It added that under its GM32 Transformation Programme, the group will continue evaluating and pursuing opportunities in new business segments to support sustainable medium- to long-term growth.

"While these initiatives may entail additional near-term investments and expenditure, the group remains committed to prudent financial management and operational resilience," it added.

For the first six months of FY2026, Gas Malaysia's net profit fell 17% to RM165.37 million, while revenue declined 12% to RM3.18 billion. The weaker first-half performance was similarly attributed to a lower average natural gas contribution margin due to lower selling prices.

The group also cited lower finance income and share of results from joint ventures, as well as higher operating expenses, administrative expenses and finance costs. These were partly offset by a higher natural gas sales volume.

As at end-June, Gas Malaysia had cash and cash equivalents of RM404.66 million against total borrowings of RM748.08 million.

Shares of Gas Malaysia closed six sen or 1.2% higher at RM5.13 on Wednesday, valuing the group at RM6.59 billion. The counter has gained more than 17% year to date.