Petronas Q1 net profit up 26% to RM13b on higher revenue, net write-back on impairment

Petronas president and group chief executive officer Datuk Wan Zulkiflee Wan Ariffin

KUALA LUMPUR: Petroliam Nasional Bhd (Petronas) saw its net profit for the first quarter ended March 31, 2018 rise 26% to RM13bil from a year ago as it benefited from overall business improvement and operational excellence, coupled with a recovery in commodity prices.

The national oil company said on Wednesday the results were also supported by the group’s ongoing focus on overall business improvement initiatives and operational excellence, coupled with a recovery in commodity prices.

Petronas group’s revenue grew by RM1.4bil to RM57.9bil I Q1 of FY18 “mainly due to higher average realised prices recorded across all products, largely offset by the effect of the strengthening of the Ringgit against the US Dollar exchange rate”.

“First quarter PAT totalled RM13bil, increased by 26% on the back of higher revenue and net write-back on impairment. 

“Earnings before interest, tax, depreciation and amortisation (Ebitda) registered a modest growth of 2% to RM25bil from RM24.6bil in the corresponding quarter last year,” Petronas said.

Petronas's cash flow from operations rose to RM21.9bil, an increase of 22% from RM18 bil a year ago.

However, the stronger ringgit versus the US dollar saw its total assets decrease marginally to RM592.8bil as at March 31, 2018, from RM599.8bil as at Dec 31, 2017. 

Shareholders’ equity rose RM900mil to RM390.7bil as at March 31, 2018 from RM389.8bil as at Dec 31, 2017 mainly contributed by profit generated during the period partially offset by the movements in foreign currency translation reserves.

Petronas said its gearing ratio was up by 0.1% to 16.2% as at March 31, 2018.

“The group’s capital investment during the quarter was RM12bil, mainly attributable to the Refinery and Petrochemical Integrated Development (RAPID) Project in Johor,”  it said.

Petronas president and group CEO Tan Sri Wan Zulkiflee Wan Ariffin said the Group will continue to drive for productivity and growth on the back of oil price recovery. 

Subject to volatility of oil price and foreign exchange rate, the Group expects the overall year-end performance to be satisfactory.

“Our encouraging performance in the first quarter of the year was attributed to our ongoing transformation efforts which focus on overall business improvement and operational excellence, coupled with a recovery in commodity prices.

“While oil prices have trended upwards, the industry must continue to be diligent in institutionalising the cost-effective discipline and the drive for efficiencies pursued over the past few years. This will ensure the sustainability of Malaysia’s oil and gas industry in the current competitive global landscape.”