Latest news with #PetronasChemicalsGroupBhd
The Sun
20-05-2025
- Business
- The Sun
Petronas Chemicals reports RM18 million net loss in Q1 as forex weighs
KUALA LUMPUR: Petronas Chemicals Group Bhd reported a net loss of RM18 million in the first quarter ended March 31, 2025 (Q1'25) due to unrealised foreign exchange losses, unfavourable net foreign exchange impact from the specialities segment, among others, despite recording a higher revenue of RM7.66 billion. The group achieved a profit of RM668 million and a revenue of RM7.50 billion in Q1'24. In a Bursa Malaysia filing yesterday, Petronas Chemicals said the quarter's higher revenue was mainly due to higher sales volume, partially offset by the strengthening of the ringgit against the US dollar. It said the reduction in net profit was mainly due to unrealised foreign exchange loss on revaluation of a shareholders loan to a joint operation entity, lower finance income arising from adjustment of timing for payment of trade payables in the preceding quarter and unfavourable net foreign exchange impact from the specialities segment. A higher plant utilisation rate of 94% was recorded compared to 87% in the previous corresponding quarter due to improved plant performance as well as lower statutory plant turnaround and maintenance activities, mainly from fertilisers and methanol segment, resulting in higher production. On prospects, the group said the results of its operations were primarily influenced by global economic conditions and petrochemical product prices, which have a high correlation to crude oil price, particularly for the olefins and derivatives (O&D) segment, utilisation rate of its production facilities and foreign exchange rate movements. The utilisation of production facilities is dependent on plant maintenance activities and sufficient availability of feedstock as well as utilities supply, Petronas Chemicals said 'The group will continue with its operational excellence programme and supplier relationship management to sustain plant utilisation level at above industry benchmark,' it said. Petronas Chemicals anticipates product prices for O&D will be impacted by the implications of the United States (US) tariffs, additional supply from new capacities and weak downstream demand. 'Fertiliser product prices are forecasted to be firm with limited supply from the Middle East amidst seasonal demand from India, Southeast Asia and Australia. 'However, ammonia and methanol product prices are forecasted to be soft due to ample supply and persistent weak demand from industrial and gasoline blending sectors,' it added. For specialties, Petronas Chemicals said the group remains cautious in navigating the challenging market conditions, as we anticipate demand uncertainty to persist across most of our end markets. Commenting on the Q1'25 performance, its managing director and CEO, Mazuin Ismail, said the group's resilience in navigating the challenging market landscape underscores the strength of its diversified portfolio. 'The improvement in earnings before interest, taxes, depreciation, and amortisation reflects our ongoing efforts on operational excellence with commendable plant utilisation rate achieved by our commodities business, despite setbacks in January 2025 that temporarily impacted operations at several plants in Kertih, Kemaman District, Terengganu,' he said. Meanwhile, regarding the implications of US tariffs, Mazuin said Petronas Chemicals is closely monitoring these developments and assessing broader implications on the overall market dynamics. He added that the group remains focused on driving excellence to maintain its resilience and competitiveness amid the current industry downturn. 'Our unwavering commitment to safe and efficient operations across all facilities continues as we are currently undertaking repair and maintenance activities at several O&D and F&M plants,' he said. Mazuin said Petronas Chemicals is also strengthening customer relationships to better meet their evolving needs while upholding strict financial discipline and prudent capital spending. – Bernama
New Straits Times
20-05-2025
- Business
- New Straits Times
PetChem swings to RM18mil net loss on forex impact, despite higher revenue
KUALA LUMPUR: Petronas Chemicals Group Bhd (PetChem) posted a net loss of RM18 million for the first quarter ended Dec 31, 2025, compared to a net profit of RM668 million in the same period last year. In a statement today, PetChem attributed the loss primarily to unfavourable foreign exchange movements. Despite this, the group's revenue rose three per cent year-on-year to RM7.7 billion in the quarter. "This is driven by higher average prices of urea, methanol, and polyethylene as well as improved sales performance in the specialties segment," it said. PetChem said its earnings before interest, tax, depreciation and amortisation (ebitda) rose 26 per cent to RM892 million. The increase was driven by improved product spreads for urea, methanol, methyl tert-butyl ether (MTBE) and olefin derivatives, alongside lower operational costs. The group said its olefins and derivatives (O&D) segment managed to recover from utilities supply disruptions that affected several plants in Kertih, as well as reduced production at Pengerang Petrochemicals Company Sdn Bhd due to feedstock unavailability. "These external issues, combined with the limited uplift in product prices amid industry oversupply, resulted in the O&D segment recording a 4 per cent decrease in quarterly revenue to RM3.5 billion," it said. Managing director and chief executive officer Mazuin Ismail said the improvement in ebitda reflects the group's ongoing efforts on operational excellence with commendable plant utilisation rate achieved by its commodities business. Moving forward, Mazuin said the group will closely monitor these developments and assess broader implications on the overall market dynamics. "To maintain our resilience and competitiveness amid the current industry downturn, we remain focused on driving excellence. "Our unwavering commitment to safe and efficient operations across all facilities continues as we are currently undertaking repair and maintenance activities at several O&D and F&M plants. "At the same time, we are strengthening customer relationships to better meet their evolving needs, while upholding strict financial discipline and prudent capital spending," he added.
New Straits Times
09-05-2025
- Business
- New Straits Times
Petronas Chemicals hit by downtime, rating slashed
KUALA LUMPUR: The spillover effects from global trade tensions may limit near-term earnings recovery for Petronas Chemicals Group Bhd, said CIMB Securities. The firm downgraded its call on the stock to 'Hold' from 'Buy' with a lower target price of RM3.53 from RM4.41 previously. "This adjustment reflects heightened earnings risks stemming from recurring operational issues, including unplanned shutdowns, unexpected disruptions and prolonged downtime, alongside a deteriorating sector outlook," it said in a note. Additionally, CIMB Securities revised downwards its earrings forecast for the company by 23.7 per cent, 25.9 per cent and 13.1 per cent for financial year 2025 (FY25), FY26 and FY27. The cuts reflect the impact of lost production from its high-margin cracker which was offline for nearly a month, lower utilisation at ex-Pengerang Petrochemicals Complex (PPC) due to prolonged downtime since early February and rising risks from recent US tariff measures, which further cloud demand visibility and intensify margin pressure. The firm noted that Petronas Chemicals' Kertih operations are undergoing another unplanned downtime, with the first cracker offline due to a vessel wall wear-and-tear issue at one of the plant's units. "This marks the second downtime this year affecting Kertih operations, following a 20-day downtime in January due to utility disruptions from Petronas Gas," it said, adding that the issue is being addressed and operations will resume by end-May. Due to this issue, CIMB Securities expect weaker earnings for the olefins and derivatives segment in the second quarter of 2025 (Q2 2025). "Although overall plant utilisation may still be around 90 per cent, we expect that the costs of rectifying the issue and reliance on strategic sourcing will likely pressure profit margins and weigh on Q2 2025 earnings," it added. Meanwhile, Pengerang Refining and Petrochemical has extended the shutdown of its cracker to the second half of May 2025. It noted that PPC is currently operating at very minimal capacity owing to an ethylene and propylene feedstock supply disruption caused by an unplanned shutdown at Pengerang Refining Company. "Given the limited operations, we project a much lower plant utilisation rate for PPC in FY25F — we now estimate it could hover around 40 per cent, down from our earlier projection of 50 per cent," it said. PPC's earnings are also expected to remain in the red, potentially matching the projected loss for Q1 2025 of between RM100 million and RM150 million.
New Straits Times
22-04-2025
- Business
- New Straits Times
Petronas Chemicals to drive operational, commercial resilience to boost growth
KUALA LUMPUR: Petronas Chemicals Group Bhd (PCG) is doubling down on its operational and commercial excellence and focusing on safety, plant optimisation, and asset reliability to strengthen resilience. Managing director/chief executive officer Mazuin Ismail said the integrated chemicals producer continues to operate in an increasingly uncertain global environment, intensified by trade tensions and ongoing market volatility. "While we have observed some improvement in commodity prices and a modest recovery in specialty chemicals demand during the first quarter of 2025, the overall outlook remains cautious," he said in a statement today. Mazuin said at the same time, PCG is continuing with its stringent financial discipline and prudent capital spending. He added that the company's growth strategy focuses on building a robust project pipeline that responds to evolving industry dynamics, while leveraging its global innovation network to deliver cutting-edge solutions. "Through these efforts, PCG remains strongly committed to long-term value creation for stakeholders and to stay competitive in an increasingly challenging environment," Mazuin said. PCG today held its 27th annual general meeting to present the company's performance to its shareholders for the financial year ended Dec 31, 2024 (FY2024). Its net profit fell to RM1.175 billion in FY2024 from RM1.696 billion in the preceding year, in line with lower earnings before interest, tax, depreciation and amortisation (Ebitda) and share of loss from associates and joint-ventures. Revenue for the year rose to RM30.67 billion against RM28.67 billion year-on-year on the back of sales volume growth across its three business segments. -- BERNAMA
