Petronas Dagangan Q2 net profit slips to RM172.75 mln

Petronas Dagangan Bhd's net profit slipped to RM172.75 million in the second quarter ended June 30, 2019 (Q2 2019) from RM314.42 million, mainly due to lower gross profit coupled with higher operating expenditure and lower other income.

In a filing with Bursa Malaysia yesterday, the oil and gas company said revenue, however, improved to RM7.61 billion in Q2 2019 from RM7.28 billion previously, due to an 8.0 per cent year-on-year (y-o-y) growth in sales volume.

The company also declared an interim dividend of 14 sen per ordinary share for Q2 2019.

In a separate statement, Petronas Dagangan said for the quarter reviewed, retail business' sales volume grew by eight per cent y-o-y, attributable to improved stations' productivity, increased number of operational stations and higher volume registered for the new Petronas Primax 95 with Pro-Drive.

"Gross profit decreased by five per cent y-o-y mainly due to declining Mean of Platts Singapore (MOPS) price trend and higher product costs during the quarter," it said.

For the same period, the company said commercial business registered a nine per cent y-o-y increase in sales volume, mainly attributable to higher demand for Jet A1, although gross profit slid nine per cent y-o-y following lower margin for diesel and declining volume for fuel oil.

On the liquid petroleum gas business, it said sales volume gained three per cent y-o-y while gross profit declined 11 per cent yo-y due to higher product costs.

"Lubricant business' sales volume and gross profit decreased 15 per cent and five per cent y-o-y, respectively following lower demand in the commercial segment amidst a competitive market landscape," it said.

For the first half of the year, Petronas Dagangan's net profit declined to RM463.95 million from RM532.90 million, while revenue was slightly higher at RM14.69 billion versus RM14.35 billion previously.

Moving forward, managing director and chief executive officer Datuk Seri Syed Zainal Abidin Syed Mohd Tahir said the company anticipated the market to remain challenging.

However, he said the company would continue to push for volume growth through leveraging its newly launched fuel and lubricants, extensive supply and distribution chain, as well as vast network of stations and partners.