PCG RECORDS LOWER NET PROFIT IN FY2024, DECLARES 3.0 SEN SECOND INTERIM DIVIDEND

KUALA LUMPUR, Feb 21 (Bernama) -- Petronas Chemicals Group Bhd’s (PCG) net profit fell to RM1.175 billion in the financial year ended Dec 31, 2024 (FY2024) from RM1.696 billion in the preceding year.

It said the lower net profit for FY2024 was in line with lower earnings before interest, tax, depreciation and amortisation (EBITDA) and share of loss from associates and joint-ventures.

EBITDA for the year declined year-on-year by 7.0 per cent to RM3.5 billion due to lower spreads and higher operating cost.

Revenue for the year, however, increased to RM30.67 billion against RM28.67 billion year-on-year on the back of sales volume growth across its three business segments, PCG said in a filing with Bursa Malaysia today.

The company `has announced a second interim dividend payout of 3.0 sen per share amounting to RM240 million for FY2024. The total dividend declared in FY2024 amounts to RM1.0 billion, representing 89 per cent of profit after tax and non-controlling interests (PATANCI).

For the fourth quarter ended Dec 31, 2024 (4Q FY2024), PCG's net profit surged to RM519.0 million from RM112.0 million a year earlier, in line with improved EBITDA and unrealised foreign exchange gain on revaluation of shareholder loan to Pengerang Petrochemical Company Sdn Bhd. 

Its EBITDA for 4Q FY2024 improved 28 per cent to RM710 million from RM554 million in 3Q FY2024, mainly due to positive foreign exchange impact. EBITDA margin increased to 10 per cent compared to 7.0 per cent in 3Q FY2024.

Revenue in 4Q FY2024 increased to RM7.46 billion against RM7.21 billion year-on-year with lower average selling prices and lower sales volume in the specialties segment.

PCG said the chemicals sector downcycle has extended longer than initially anticipated, owing to stagnant global demand amid capacity oversupply.

Additionally, effects of significant rise in newly built capacities, especially in Northeast Asia, that is surpassing demand growth, kept pressures on prices and margins, it added.

The group said it navigated headwinds through its diverse product offerings and leveraged on its fertiliser and methanol (F&M) segment with relatively stable levels of demand and prices for urea and methanol within the Asia Pacific region throughout 2024.

It also benefitted from plant efficiency improvements and reduction in downtimes, despite undertaking turnaround activities at four of its manufacturing plants.

PCG said this has resulted in average plant utilisation rate of 91 per cent against 85 per cent in 2023, which boosted production and sales volume of commodities chemical products within the olefins and derivatives (O&D) and F&M segments.

"We met our operational targets, with plant utilisation for the O&D and F&M segments returning to above the 90 per cent mark, despite the challenges faced earlier in the year. The specialties segment also saw improved sales on supply constraints and improved demand for oxo and polyols,” said PCG managing director/chief executive officer Mazuin Ismail in a statement.

He noted that market conditions were expected to remain unchanged in 2025 in view of uncertainties posed by changing geoeconomic policies and potential retaliatory actions by affected countries, in addition to ongoing geopolitical events.

“We still must contend with oversupply in global petrochemical products, even as demand recovers given that capacity additions are expected to exceed demand growth by approximately 50 per cent this year.

"From late 2024 and into 2025, we have observed a decline in prices and spreads in O&D, with signs that Southeast Asia integrated spreads are anticipated to remain in a trough,” he added.

Mazuin added that PCG remained focused on ensuring safe and efficient operations, keeping a close eye on the market and strengthening its financial discipline.

-- BERNAMA