Petronas Chemicals posts 42% earnings growth in FY2017

KUALA LUMPUR: Petronas Chemicals Bhd posted a slight bump in fourth quarter earnings to RM1.01bil and 20% higher revenue of RM4.74bil, bolstered by higher crude oil prices and better sales volume from the commencement of the Sabah Ammonia and Urea (Samur) project.

The final quarter results brought the group's full-year revenue to RM17.41bil, representing 25.5% growth over the previous year. Net profit surged 42% to RM4.18bil from a year earlier.

Earnings before interest, taxes, depreciation and amortisation (Ebitda) increased by RM1.3 bil or 25% to RM6.6bil.

The group declared an interim dividend of 15 sen per share with entitlement and payment dates on March 7 and 21 this year. This brought total dividend for the financial year to 27 sen a share.

"The results of the group’s operations are expected to be primarily influenced by global economic conditions, utilisation rate of our production facilities and petrochemical products prices which have a high correlation to crude oil prices, particularly for the Olefins and Derivatives segment," it said.

It added that the weakening US dollar partially offset the revenue growth experienced during the period.

The group said its plant utilisation was lower at 91% compared to 96% in the corresponding year mainly due to higher statutory turnaround activities undertaken during the current year. 

Hoewver, production and sales volumes were higher following commencement of commercial operation at Samur in May 2017.

"The utilisation of our production facilities is dependent on plant maintenance activities and sufficient availability of feedstock as well as utilities supply. 

"The group will continue with its operational excellence programme and supplier relationship management to sustain plant utilisation level at above industry benchmark."

Moving forward, the group expects prices to further improve given the tightening supply situation and healthy demand.