PETRONAS CHEMICALS 1Q NET PROFIT FALLS TO RM532 MLN ON HIGHER COSTS, LOWER PRODUCT PRICES

KUALA LUMPUR, May 29 (Bernama) -- Petronas Chemicals Group Bhd’s (PCG) net profit for the first financial quarter ended March 31, 2023 (1Q FY2023) fell to RM532 million from RM2.07 billion in the same quarter last year.

PCG said its earnings before interest, taxes, depreciation, and amortisation (EBITDA) were lower by RM1.3 billion, or 55 per cent at RM1.1 billion mainly due to “lower product spreads and higher energy and utility costs.”

Revenue, however, increased 14 per cent to RM7.56 billion from RM6.63 billion previously, due to the inclusion of revenue contribution from a recently acquired subsidiary and higher sales volumes but partially offset by lower product prices.

PCG said the revenue for the olefins and derivative segment was higher by RM650 million, or 24 per cent at RM3.4 billion, primarily due to higher sales volumes and the weakening of the ringgit against the US dollar. Its specialty segment’s revenue increased by RM1.2 billion to RM1.7 billion, primarily due to the inclusion of a recently acquired subsidiary.

However, the fertiliser and methanol segment revenue decreased by RM897 million, or 27 per cent to RM2.4 billion, primarily attributed to lower product prices but partially offset by the weakening of the ringgit against the US dollar.

In a separate statement, managing director and chief executive officer Mohd Yusri Mohamed Yusof said although the company saw some positive movements in selected regions in the first quarter, the overall chemical sector remains cautious given the still volatile energy prices.

“There has been some uplift in demand from China post-Chinese New Year for selected chemicals, but we have yet to see a meaningful recovery.

“Operating costs, on the other hand, have increased due to effects of inflation on gas and fuel, giving rise to energy and utility costs, further narrowing product spreads and adding pressure on margins,” he said.

The group continues to be cautious of the outlook for 2023 on worries over the US banking sector and its potential impact on the global economy, prolonged Russia- Ukraine war, and a slower-than-expected recovery in China, he added.

-- BERNAMA