PetGas’ 4Q earnings fall due to losses at JV


Petronas Gas Bhd’s (PetGas) net profit for the fourth quarter ended Dec 31, 2018 (4Q18) fell 34.68% year-on-year (YoY) to RM317.9 million due to losses at joint venture (JV) company Kimanis Power Sdn Bhd (KPSB).

In an exchange filing yesterday, PetGas noted the losses arose due to de-recognition of deferred tax assets (DTAs) amounting to RM124.3 million in relation to certain tax benefits which now have a seven- year utilisation limit under the new Finance Act 2018.

“Excluding the impact of DTAs from KPSB, profit for the quarter would be lower by 8.6% or RM43.7 million due to a one-off impairment loss on assets and higher finance costs. The impairment followed the change of business at one of our customers and the amount was recognised after all efforts to find alternative use for the facilities were exhausted,” the company stated.

The higher finance costs for the period were due to recognition of previously capitalised interest expense following completion of the group’s second liquefied natural gas (LNG) regasification terminal.

The group’s gas processing segment gross profit improved by 2.6% YoY to RM157.5 million on comparable revenue, mainly contributed by lower operating costs following the completion of maintenance activities in 3Q18.

The regasification segment’s gross profit grew 11% YoY to RM170.2 million in line with higher revenue, offset by higher depreciation costs following full completion of the second LNG regasification terminal project in 2Q18.

The board has declared a fourth interim dividend of 22 sen to be paid on March 15, 2019.