Petronas Dagangan Q1 earnings up 15%, thanks to improved margins

PETALING JAYA: Petronas Dagangan Bhd’s net profit rose by 15.38% for the first quarter ended March 31, attributable to the improved margins in liquefied petroleum gas, retail and commercial sectors.

The group recorded a net profit of RM253.15 million against the RM219.40 million in the preceding year’s corresponding quarter.

The 31% increase in average selling price of mogas and diesel in the retail segment and the 60% increase in selling price in the commercial segment propelled revenue up by 36.16% to RM6.68 billion compared with RM4.91 million in the corresponding quarter last year.

In view of its performance the group has declared an interim dividend of 14 sen per ordinary share for the quarter under review.

“The directors are of the opinion that the economic and business environment outlook for FY2017 remains uncertain. The group will continue to focus on inventory management, supply and distribution efficiency as well as operating expenditure optimisation to ensure the company remains resilient in the face of a challenging environment,” its board of directors said in a Bursa Malaysia filing.

In a separate statement Petronas Dagangan managing director and CEO Datuk Ibrahimnuddin Yunus said the company cannot maintain business as usual in the face of a challenging environment, and it will continue to invest in technology to improve operational and cost-efficiencies and extend its reach to a wider customer base.

Petronas Dagangan's retail segment will be leveraging on products, namely Primax 95 with Advanced Energy Formula, Primax 97 Euro 4M with Advanced Energy Formula and Dynamic Diesel Euro5, while the commercial sector will emphasise value maximisation by improving margins in targeted product and market segments like public and private sector investments in infrastructure and construction projects, superior logistics, personalised services and differentiated offerings to sustain and capture new markets.

The board expects the price of Brent crude oil, which currently ranges between US$49.20 and US$56.30 a barrel, to remain volatile during the year.