Petchem registers Rm506mil profit in Q1
PETALING JAYA: Petronas Chemicals Group Bhd (Petchem) posted a net profit of Rm506mil in the first quarter ended March 31 (Q1), lower by 37% from Rm800mil in the same period last year.
Revenue was lower by Rm239mil or 6% at Rm3.9bil, largely due to lower product prices.
Petchem said its earnings before interest, taxes, depreciation and amortisation or Ebitda decreased by Rm498mil or 39% at Rm764mil, mainly due to compressed margins.
The group maintained strong operational performance with a high plant utilisation rate and sales volume.
It registered a high plant utilisation rate of 94%, comparable to the first quarter of financial year 2019.
“The group’s earnings were impacted by the sharp decline in petrochemical product prices, following the outbreak of Covid-19.
“The industry downcycle deepened as crude oil prices collapsed due to the Opec+ fallout and the recessionary global economic outlook,” Petchem said in a statement yesterday.
Managing director and CEO Datuk Sazali Hamzah said 2020 started off as an unprecedented year for most industries in the wake of the Covid-19 pandemic followed by the Opec+ fallout.
“Nevertheless, the group continued to demonstrate resilience in Q1 by maintaining our operational efficiency, customer centricity and diverse product portfolio.
“Our solid operational and commercial capabilities allow us to be responsive to market changes.
“We have been able to circumvent the disruptions from lockdowns that are happening worldwide and sustain our business,” Sazali said.
He added that Petchem will proceed with the commissioning and commercialisation of its chemical plants within the Pengerang Integrated Complex in Johor.
On its outlook, Sazali said the Covid-19 pandemic and Opec+ fallout have heightened economic as well as market uncertainties.
“Product prices will generally remain under pressure in this difficult environment. It is imperative that we remain resilient as we face the full impact of the pandemic and subsequent economic downturn.
“We are confident that our business continuity plan will ensure that we overcome these challenging times,” he added.