PETALING JAYA: Lotte Chemical Titan Holding Bhd’s net profit for the third quarter ended Sept 30, 2020 fell 13.7% to RM78.77 million from RM91.30 million a year ago as a result of higher share of associate losses due to lower product margin and higher operating cost and direct costs resulting from Hurricane Laura.
Its revenue decreased 10.4% to RM1.94 billion from RM2.17 billion due to lower average product selling price.
For the nine months period, it saw a net loss of RM2.57 million compared with a net profit of RM251.98 million in the same period last year due to the decrease in other income due to one-off insurance claim in 2019, withholding tax from disposal of Lotte Chemical Titan Nusantara’s shares by Chemical Brothers Limited, decrease in finance income and increase in share of losses from associates.
Group revenue decreased 23% to RM4.98 billion from RM6.46 billion due to decrease in average product selling price and sales volume.
The company has said that its average product selling prices were still lower year-on-year, amid the economic fallout from the global pandemic in 2020. The company has also noted that its overall plant operating rate has further increased to 90% during the quarter, from 86% recorded last quarter.
Operationally, the company has highlighted that it remained solid and resilient despite the hostile
external business environment plagued by post-pandemic economic slowdown.
For the quarter, the company generated a positive operating cash flow (OCF) of about RM292 million, which brings the total OCF generated to RM804 million, to-date this year. Additionally, the company’s position is further complemented by its healthy balance sheet with net cash position of close to RM4 billion as at Sept 30, 2020.
“Year-to-date, our business is now back in the black and had since observed operational performance turnaround with continuously improving gross profit margin trends. The achievements are now testament to our strong business and operational fundamentals, which will ensure our business sustainability during this very challenging period,” said president & CEO Dr Lee Dong Woo.