Petronas Chem­i­cals’ Q3 profit dips on higher tax ex­pense

The Sun (Malaysia) - - MEDIA & MARKETING -

PE­TAL­ING JAYA: Petronas Chem­i­cals Group Bhd (Petchem) re­ported a 2.7% de­cline in net profit to RM891 mil­lion for the third quar­ter ended Sept 30, 2016 from RM916 mil­lion in the pre­vi­ous cor­re­spond­ing pe­riod, due to higher tax ex­pense.

Rev­enue for the quar­ter un­der re­view was lower by 2.1% from RM3.64 bil­lion to RM3.56 bil­lion, dragged down by lower av­er­age prod­uct prices.

In a fil­ing with the stock ex­change, Petchem said av­er­age prod­uct prices for the olefins and de­riv­a­tives seg­ment were lower as they were af­fected by weaker crude oil prices.

The group said the de­cline in methanol prices was due to lower de­mand for fuel ad­di­tives while am­mo­nia and urea prices were af­fected by over­sup­ply in the mar­ket with new ca­pac­ity ad­di­tions.

Petchem said its op­er­a­tions are ex­pected to be pri­mar­ily in­flu­enced by global eco­nomic con­di­tions, util­i­sa­tion rate of its pro­duc­tion fa­cil­i­ties and petro­chem­i­cal prod­ucts prices which have a high cor­re­la­tion to crude oil prices, par­tic­u­larly for the olefins and de­riv­a­tives seg­ment.

It noted that the util­i­sa­tion of the pro­duc­tion fa­cil­i­ties is de­pen­dent on plant main­te­nance ac­tiv­i­ties and suf­fi­cient avail­abil­ity of feed­stock as well as util­i­ties sup­ply.

“With im­proved plant main­te­nance pro­gramme and sup­plier re­la­tion­ship man­age­ment, the group aims to achieve bet­ter plant util­i­sa­tion for 2016 com­pared to the pre­vi­ous year,” it said.

For nine months of the year, Petchem’s net profit fell 6.4% from RM2.08 bil­lion to RM1.95 bil­lion on the back of a 1.7% drop in rev­enue from RM10.09 bil­lion to RM9.91 bil­lion.

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