PetChem sees one-third jump in Q2 net profit to RM1.38bil

KUALA LUMPUR: Petronas Chemicals Group Bhd 's Q2 net profit grew by a third to RM1.38bil from RM1.02bil in the year-ago quarter, underpinned by fewer maintenance activities at its plants and statutory turnaround days while production and sales volumes rose.

The group also noted that higher crude oil prices led to higher overall average product prices.

Revenue for the quarter under review was boosted 19.5% to RM4.73bil from RM3.96bil due to the higher product prices and sales volumes although the strengthening ringgit versus the US dollar partially offset the increase.

EBITDA was higher by RM290mil or 19% to RM1.8bil in line with the increase in revenue.

The group has declared an interim dividend of 14 sen a share payable on Sept 20, 2018.

In the olefins and derivatives segment, higher revenue of RM28bil was achieved on the back of higher product prices. However, EBITDA was comparable with the previous quarter at RM845mil due to lower sales voumes of ethane-based products. 

Profit after tax grew 10% to RM674mil due to lower tax expenses.

Meanwhile, the fertiliser and methanol segment also experienced higher product prices and sales volumes to hit 39% higher revenue of RM2bil.

EBITDA grew 52% to RM878mil while profit after tax grew 70% to RM678mil.

The group expects the olefins and derivatives segment to be stable over the near term as it is suppported by healthy downstream demand and firm feedstock prices. 

"However, supply is expected to meet demand as major producers have started up after their scheduled turnarounds," it said.

The group expects its fertiliser and methanol segment to be stable in light of the turnaround in the Middle East region and US sanction on Iran.

Methanol prices are forecasted to be firm primarily owing to short supply due to upcoming planned turnarounds in China and South East Asia, supported by healthy demand in line with resumption of methanol-to-olefins plants from turnarounds.

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