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Hengyuan Refining chalks up RM667.48 mln net profit in Q2 on better margins

30/08/2022 09:16 PM

KUALA LUMPUR, Aug 30 (Bernama) -- Hengyuan Refining Company Bhd posted a net profit of RM667.48 million for its second quarter (Q2) amid better refining margins, coupled with company-wide cost optimisation initiatives, as compared with a net loss of RM59.37 million in the same quarter last year.

Revenue for the quarter ended June 30, 2022 rose to RM6.89 billion as compared with RM2.5 billion a year ago, it said in a filing with Bursa Malaysia today.

“The increase in the company’s revenue for both the current quarter and cumulative period was due to higher product prices and sales volume.

“The product prices in the second quarter and year to date 2022 improved from an average price of US$75 per barrel and US$71 per barrel for the corresponding periods in 2021 to US$151 per barrel and US$133 per barrel, respectively,” it said.

Sales volumes for the quarter and year to date 2022 rose by 35 per cent and 33 per cent, respectively, as compared to the corresponding periods in 2021, as a result of stronger demand.

“Improvement in refining margin was contributed by better cracks for Mogas, Gasoil and Jet Fuel as well as stockholding gains in both the second quarter of 2022 and year to date 2022, fueled by market sentiments over the oil supply and demand imbalance,” the company said.

Net profit for the first half of the year rose to RM714.94 million as compared to a net loss of RM43.06 million, while revenue was higher at RM11.84 billion versus RM4.69 billion previously.

As for the outlook, it said the industry continued to be challenged by volatility in the global oil market.

“The company is actively monitoring the current market conditions and will continue its efforts to focus on operational efficiency, product quality, hydrocarbon hedging and financial risk management to optimise performance,” it said.

As for the Euro 4 Mogas project, it is expected to be completed in the fourth quarter of 2022.

“Any delay is not expected to have significant adverse effects on the company’s operations and its ability to supply to the market.

“The company has been able to produce some volumes of Euro 4 Mogas based on the plant’s existing configuration in fulfilling its supply obligations to customers,” it noted.

No dividend was paid during the current quarter and for the financial period ending June 30, 2022.

However, the board of directors have, in respect of the financial year ending Dec 31, 2022, declared a first interim single tier dividend of 10.00 sen per share on 300 million ordinary shares.

The dividend will be payable on Oct 25, 2022, to shareholders of ordinary shares whose names appear in the Record of Depositors at the close of business on Oct 3, 2022.



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