From RM800 million in Q1 2019, Petronas Chemicals Group Bhd (PCG) reported slipped net profit to RM506 million in Q1 2020. From RM4.13 billion previously, revenue also eased to RM3.89 billion.
PCG attributed its performance to softer demand following the Covid-19 pandemic, decline in crude oil price as well as lower product prices.
Revenue from its olefins and derivatives segment during the quarter, as a result of lower product prices, declined by RM351 million or 13 percent year-on-year to RM2.4 billion. Revenue from its fertilisers and methanol segment, due to a decline in product prices, also decreased by RM106 million (8 percent) to RM1.3 billion.
Besides global economic conditions and utilisation rate of production facilities, the group’s results are expected to be primarily influenced by foreign exchange rate movements as well as petrochemical products prices which have a high correlation to the crude oil price.
If the Covid-19 pandemic eases and there is an improvement in crude oil price, the group anticipates product prices to marginally recover towards year-end for its olefin and derivatives segment. As the demand is less impacted by the pandemic, PCG forecast fertilisers prices to remain stable.
