Dialog’s earnings outlook intact

KUCHING: Dialog Group Bhd’s ( Dialog) earnings outlook remains intact, driven by its projects at the Refinery and Petrochemical Integrated Development ( Rapid), analysts observed.

In a report, the research team of Public Investment Bank Bhd ( PublicInvest Research) said Dialog’s earnings outlook is expected to remain intact as it expected more to come from the Phase 2A, the dedicated petroleum and petrochemicals terminal for Rapid which just commenced its initial stages of commercial operations in November 2018.

“Moreover, the development of Phase 3 and future phases of PDT on the remaining 500 acres land will also be a boon to the group’s other divisions,” it added.

“We understand that the development of Phase 3 is scheduled for completion at end of 2019, and currently the group is in negotiations with its potential customers,” the research team said.

The research arm of Am Investment Bank Bhd (AmInvestment) noted that the land reclamation of Pengerang Phase 3 involves the construction of petroleum/ petrochemical storage and a third jetty at an indicative initial cost of RM2.5 billion, in which Dialog will have an 80 per cent equity stake and the Johor state 20 per cent.

“We expect any co-investments in petrochemical operations with multinational players to be associate-level, valueenhancing and internally funded without any equity- raising requirements.

“This will be part of a 500acre zone comprising further reclaimable land and the adjoining buffer zone.

“Additionally, Dialog will be expanding its dormant Langsat Terminal 3 into a 300,000 m3 storage facility,” it opined.