Petronas Chemicals posts RM1.08b net loss in Q2 on operational, market challenges
This comes amid heightened geopolitical tensions in the Middle East and tariff announcements, which affected crude oil prices and weakened the US dollar.
The chemicals producer posted a net loss of RM1.08 billion for the quarter ended June 30, 2025, compared with a net profit of RM777 million a year earlier.
This was mainly dragged by a 56 per cent drop in lower earnings before interest, tax, depreciation and amortisation (Ebitda) to RM396 million.
The loss was also affected by a remeasurement loss from adjustments in the timing of trade payable payments and an impairment of assets at Perstorp.
It was further impacted by higher unrealised foreign exchange losses from the revaluation of a shareholder loan to a joint operation, as well as increased depreciation and finance costs from the same entity.
The revenue also fell nearly 17 per cent to RM6.4 billion from RM7.7 billion last year due to lower sales volumes and average product prices.
Petronas Chemicals declared first interim dividend of three sen amounting to RM240 million that will be paid on Sept 10, 2025.
For the first half of 2025, the group revenue declined 7.0 per cent to RM14.1 billion largely on foreign currency translation following the strengthening of the ringgit against the US dollar and lower average product prices.
It recorded net loss of RM1 billion on adjustment of timing of payment for trade payables at Pengerang Petrochemical Company Sdn Bhd, impairment of assets at Perstorp, as well as unrealised foreign exchange loss on revaluation of shareholders loan, higher depreciation and finance costs at Pengerang Petrochemical.
In a statement, Petronas Chemicals managing director and chief executive officer Mazuin Ismail said the results reflect several operational challenges both internal and external, that impacted the plants' performance.
He added that the commodities market remains challenging amid persistent oversupply and ongoing trade as well as geopolitical tensions.
"Nevertheless, demand continues to grow, particularly in Asia, driven by population and urban growth. Our Pengerang facility, built to support this growth, is currently operating to meet the creditors reliability test by year-end," he added.
Mazuin said that in light of the increasingly dynamic market environment, Petronas Chemicals are undertaking strategic portfolio review across value chain.
"While market conditions remain challenging, we are confident that our strong fundamentals combined with the initiatives currently underway will continue to strengthen our resilience," he said.
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