PetDag quarterly earnings up 28%

Higher margins for fuel in retail segment drives growth in Q2

PETALING JAYA: Petronas Dagangan Bhd (PetDag) saw its net profit increase 28% to RM314.42mil for the second quarter ended June 30, 2018, from RM246.04mil in the corresponding quarter last year.

The improved earnings were driven by growth in the retail segment on higher margins for fuel.

During the quarter in review, the retailer and marketer of downstream oil and gas products posted a 10% increase in revenue to RM7.28bil from RM6.12bil in the previous corresponding period.

Earnings per share (EPS) rose to 31.60 sen from 24.80 sen.

The company announced a second interim dividend of 16 sen per

share, bringing the total year-todate payout to 29 sen per share.

PetDag’s shares closed unchanged yesterday at RM26.90.

For the quarter in review, PetDag said pre-tax profit from its retail segment rose 57% year-on-year (y-o-y) to RM237.6mil, in line with increasing Mean of Platts Singapore (MOPS) product prices, while its commercial segment saw a 3% growth to RM152.6mil.

For the retail segment, PetDag said: “Lower product and freight costs also contributed to higher margins for mogas, diesel and retail LPG (liquified petroleum gas). This was partially offset by higher spending on advertising and promotion.”

For the commercial segment, it said, higher earnings were attributable to improved margin from fuel oil resulted from higher sales premium.

In total, PetDag’s net profit rose 6.8% to RM532.9mil for the six months to June 2018 from RM499.2mil in the previous corresponding period, and its EPS rose to 53.60 sen from 50.20 sen. This was driven mainly by growth in the retail segment.

PetDag saw its revenue grow 7.1% to RM14.35bil for the first half of this year from RM13.39bil in the corresponding period last year.

The company said revenue for its

retail segment rose 1% y-o-y to RM7.39bil, thanks to increase in average selling prices by 3%.

Overall, however, retail volume was lower by 2% due to higher average pump prices and challenging market conditions.

Revenue for its commercial segment rose 14% y-o-y to RM6.95bil, mainly driven by volume growth of 4%, coupled with increase in average selling price by 10%.

The improved volume was mainly contributed by fuel oil and bulk LPG as a result of intensified sales and marketing efforts.

In addition, diesel and sulphur sales grew following higher customer demand.