The impact of Covid-19 and MCO contributed to the weaker 2Q sales volume
by FARA AISYAH/ pic by MUHD AMIN NAHARUL
PETRONAS Dagangan Bhd’s (PetDag) stated lower volumes of petrol products sold to retail and commercial clients saw its earnings for the second quarter ended June 30, 2020 (2Q20), plunge 97.97% year-on-year (YoY) to RM3.51 million.
The weaker sales were due to the impact of Covid-19 pandemic globally and the implementation of Movement Control Order (MCO) in Malaysia.
PetDag’s earnings per share for the period tumbled to 0.4 sen from 17.4 sen in 2Q19.
Revenue for the period fell 61.5% YoY to RM2.93 billion as its retail segment’s revenue declined by 52.71% YoY to RM1.83 billion due to lower sales volume of 32% in tandem with low demand due to MCO, as well as lower average selling prices by 30%.
The segment’s profit before tax (PBT) tumbled 79.96% YoY to RM22.5 million due to decrease in revenue from petrol and diesel following declining Mean of Platts Singapore prices, offset by lower opera-ting expenditure contributed by lesser advertising and promotion activities.
PetDag’s commercial segment recorded a 70.51% YoY decline in revenue to RM1.1 billion on lower average selling prices (down 44% YoY) and volume (downs 47%) respectively following lesser demand.
The commercial segment posted a loss before tax of RM2.9 million in the quarter, compared to a PBT of RM130.2 million mainly due to lower margins and volume from Jet A1 and Diesel.
PetDag MD and CEO Azrul Osman Rani said April was the most challenging month given the Covid-19 pandemic coupled with the declining petroleum product prices.
“Our business has seen a sharp improvement since the ease of restrictions by the government from May onwards compared to April. We are cautious the aviation sector may take longer to recover and this will continue to affect our Jet A1 sales volume,” he said in a statement yesterday.
He added that the group is focused on prudent cash management, effective risk mitigation and ensuring its ecosystem remained robust.
For the first half of the year (1H20), PetDag posted a net loss of RM25.91 million, compared to RM463.95 million net profit in 1H19. Revenue for the six months declined 35.4% YoY to RM9.49 billion.
The board has declared an interim dividend of five sen to be paid on Sept 24, 2020.