Petronas Chemicals Group Bhd made its foray into specialty chemicals via inorganic growth with the purchase of Da Vinci Group B.V.
KUALA LUMPUR: Petronas Chemicals Group Bhd
's net profit fell by 24.7% in the first quarter ended March 31, 2019 due to lower revenue and higher operating expenditure.
It announced on Friday its net profit fell to RM802mil from RM1.065bil a year ago. Its revenue declined by 16.5% to RM4.13bil from RM4.95bil largely due to lower product prices and sales volumes, partially offset by the weakening of the ringgit against the US dollar.
Earnings per share were lower at 10 sen compared with 13 sen a year ago.
Petronas Chemical said it recorded lower plant utilisation of 95% as compared to 100% a year ago, mainly due to higher level of maintenance and statutory turnaround activities at its methanol and aromatics plants respectively. Sales volumes were lower in line with lower production.
“Its earnings before interest, tax, depreciation and amortisation (Ebitda) decreased by RM578mil or 31% to RM1.3bill in line with lower revenue and higher operating expenditure relating to maintenance activities,” it said.
Hence, profit after tax also reduced by 27% to RM813mil following lower Ebitda, partially offset by lower tax expense. In addition, there was an impact of foreign exchange loss on its shareholder loans pursuant to the divestment of 50% equity interest in a subsidiary a year ago.
On the olefins and derivatives, the segment maintained plant utilisation of 100%. Nonetheless, both production and sales volumes slightly decreased due to statutory turnaround activities at its aromatics plant. Average product prices for the segment declined as crude oil prices decreased.
Revenue fell by 13% to RM2.7bil due to lower product prices and sales volumes, partially offset by the weakening of the ringgit against the US dollar.
Ebitda fell by 34% to RM733mil mainly due to lower revenue and higher operating expenditure relating to maintenance activities. Profit after tax declined by 36% to RM461mill in tandem with lower Ebitda, partially offset by lower tax expense.
Petronas Chemical said the fertilisers and methanol segment’s operational performance was lower with plant utilisation of 92% compared to 100% a year ago mainly due to higher level of maintenance activities at its methanol plants.
“Sales volumes were lower in line with lower production. Average product prices for the segment was lower mainly for methanol in tandem with lower crude oil price and ample supply,” it said.
The segment’s revenue decreased by 25% to RM1.4bill mainly due to the decline in product prices and sales volumes, partially offset by the weakening of the ringgit against the US dollar.
Ebitda declined by 25% to RM587mil following lower revenue and higher operating expenditure relating to maintenance activities. Profit after tax fell by 32% to RM382mil.
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