PetChem’s FY21 profit jumps on higher petrochemical prices

Our stellar FY21 performance is attributed to operational and commercial excellence initiatives undertaken by our team, says CEO 

By NUR HANANI AZMAN / Pic by BERNAMA

PETRONAS Chemicals Group Bhd (PetChem) achieved its best financial performance in the financial year ended Dec 31, 2021 (FY21), with its net profit soaring to RM7.35 billion from RM1.63 billion in 2020, driven by the surge in petrochemical prices throughout the year. 

Revenue jumped 60% year-on-year to RM23.03 billion supported by high plant utilisation of 93% despite several statutory turnaround and maintenance activities undertaken during the year. 

Earnings per share stood at 92 sen against 20 sen in FY20, the company said in a filing to Bursa Malaysia yesterday. 

PetChem MD and CEO Ir Mohd Yusri Mohamed Yusof said despite the strong year, the group faced challenges such as global supply chain constraints, price shocks, effects of climate change and Covid-19 related restrictions. 

“Our stellar FY21 performance is attributed to operational and commercial excellence initiatives undertaken by our team. Despite the market uncertainties, we captured opportunities, delivered our production and sales targets, and most importantly, served our customers in a timely manner with innovative products and solutions,” he said in a statement. 

For the fourth quarter of FY21, Pet- Chem’s net profit rose to RM2.06 billion compared to RM466 million in 4Q20, while revenue was higher at RM6.98 billion from RM3.84 billion in 4Q20. 

Strong operations were maintained in 4Q21, with sales volume of two million metric tonnes and marginally lower plant utilisation rate of 89%, which was due to statutory turnaround activities at a fertiliser plant in Bintulu, Sarawak. 

A second interim dividend of 23 sen per share was declared for FY21, payable on March 25, 2022. 

The total dividend declared for FY21 amounted to RM4.5 billion, representing 61% of profit after tax and non-controlling interests.

On its 2022 outlook, Mohd Yusri said the group is off to a good start with product prices anticipated to remain firm, sup- ported by the high crude oil and natural gas prices amid ongoing geopolitical tensions and OPEC lagging production increase. 

He anticipates that the market correc tion to gradually occur once demand is balanced with supply from new capacities in the Asia-Pacific region, scheduled to come onstream in 2022. 

“On the longer-term growth front, we recently announced the building of a melamine plant in Gurun, Kedah. This plant is targeted to come onstream in 2024, in line with our strategy to add value to our existing molecules. 

“As we pursue our growth agenda, we reinforced our commitments to create positive impacts on economic, environmen- tal and social aspects. We have completed our net zero carbon emissions roadmap which sets our carbon reduction goals and pathways, starting with a reduction of 20% by 2030 towards becoming net-zero by 2050,” he concluded.