Petronas Dagangan posts lower profit in Q2

petronas station

KUALA LUMPUR: Petronas Dagangan Bhd, the country's biggest petrol station operator, said the retail market is expected to remain challenging amid rising numbers of energy efficient cars, as well as the growing usage of public transportation and e-hailing services.

The company plans to leverage on new fuel products to retain and win new customers.

It will also focus on strengthening dealership and network management as well as enhancing customer experience through digital initiatives such as Setel, an e-payment solution.

"Retail plan to increase its profitability by pursuing strategic partnerships to enhance product offerings," it said.

In the second quarter ended June 30, Petronas Dagangan made a net profit of RM172.7mil, down 45% compared with RM314.4mil.

Revenue was up at RM7.6bil from RM7.3bil previously, the company said in a filing with Bursa Malaysia today.

The company has declared an interim dividend of 14 sen a share.

Petronas Dagangan said both its retail and commercial businesses reported higher volume sold during the quarter under review, but its profit margin declined on lower average selling prices.

Its retail business generated RM3.87bil in revenue during the quarter, driven by higher sales volume of 7% following improved station productivity, higher number of stations in operation and introduction of the new Petronas Primax 95 with Pro-Drive fuel.

This was offset by decrease in average selling prices of 3%.

The retail segment reported a pre-tax profit of RM112mil, or 53% lower than the previous corresponding three-month.

The drop in earnings was also contributed by higher advertising and promotion spending during the quarter.

Meanwhile, stronger demand for jet fuel propelled contribution from its commercial business.

Petronas Dagangan said the commercial Segment recorded higher revenue of RM181mil to RM3.7bil following an increase in sales volume of 9%, offset by lower average selling prices of 4%.

The segment contributed a pre-tax profit of RM130mil, down 15% compared with RM153mil previously.

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