KUALA LUMPUR: Shell Refining Co (Federation of Malaya) Bhd (SRC), which is in the midst of a change in majority shareholder following Royal Dutch Shell’s proposed sale of its 51% stake, posted an encouraging net profit of RM101.65mil for the first quarter ended March 31, 2016, up 20.7% from the same period a year earlier.
The petroleum product refiner, which swung back into profitability last year after four years in the red, told Bursa Malaysia on Monday that this was contributed by higher margins and lower operating expenses.
The higher profit was achieved on 24.5% lower revenue of RM1.87bil, which was the result of lower product prices and sales volume.
SRC said its Port Dickson refinery processed 10.2 million barrels of crude oil in Q1, higher by 7% from the corresponding period of last year.
Sales were, however, lower by 1% at 10.4 million barrels versus 10.5 million barrels previously.
By comparison, in the same quarter, Royal Dutch Shell's earnings tumbled on a current cost of supplies basis to US$0.8bil from US$4.8bil a year earlier.
On prospects for the year, SRC said: “The outlook for refining margins remains uncertain for 2016 as margins will be influenced by international supply and demand for petroleum poducts, as well as seasonal and cyclical factors.”
SRC share price has fallen 64.6% since the start of this year, closing at RM3.02 on Monday -- down 2 sen from the previous day.
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