Shell Malaysia returns to profitability in Q1

KUALA LUMPUR: Shell Refining Co (Federation of Malaya) Bhd returned to the black with an after-tax profit of RM84.23mil for the first quarter (Q1) ended March 31, 2015 from a loss of RM44.08mil a year earlier.

This was achieved on the back of 37.8% lower revenue of RM2.48bil. The reduced revenue was due to lower product prices this year.

“Higher profit in Q1 2015 is contributed by improved refining margins and losses in Q4 2014 due to stockholding losses of RM445.8mil and impairment losses of RM461mil,” the oil firm told Bursa Malaysia on Monday.

On the current year’s prospects, it said the strong refining margins for Q1 were positively influenced by the lag in product pricing adjusting to crude pricing levels and delays in start up and stabilisation of new refining capacity in the region.

“Refinery margins remain uncertain and will be influenced by international supply and demand for petroleum products, and seasonal and cyclical factors,” it said, adding that it planned a major maintenance turnaround spanning seven weeks in the third quarter of 2015.

“Maintaining strong operational performance and maintaining product quality will continue to remain the refinery’s key focus area to maximise margin opportunities.”

Shell closed trading at RM4.90 on Monday, up 8 sen.

Petroliam Nasional Bhd is scheduled to announce its Q1 financial results on Friday. Petron Malaysia Refining & Marketing Bhd also has not announced its Q1 numbers.