( Kuala Lumpur, 22 May 2020 ) Due to the plunge in oil prices, PETRONAS net profit plummeted 68% year-on-year to RM4.5 billion in the first quarter of fiscal year 2020 (ending March 31), compared with RM14.2 billion in the same period last year It closed from RM62 billion, down 4% year-on-year to RM59.6 billion.
PETRONAS pointed out that despite the increase in oil production and the strengthening of the US dollar, the first quarter results were still disappointing, due to the plunge in the average selling price of crude oil, petroleum products and liquefied natural gas (LNG), coupled with a sharp increase in asset impairment, leading to net profit Significantly shrink.
Even after deducting asset impairments, the after-tax profit was only RM9.2 billion, a decrease of nearly 35% compared to RM14.1 billion in the same period last year. In addition, Petronas allocated a total of RM8.5 billion in capital investment in the first quarter, mainly for upstream business.
PETRONAS President and Chief Executive Officer Wan Zulkiflee said in a statement that PETRONAS will continue to face challenges in the remaining 2020 and hopes that economic activities will resume in the second half of the year. However, if the economic downturn continues and crude oil prices remain at low prices, it will have a negative impact on PETRONAS and other oil and gas companies. Wan Zulkiflee said that due to the outbreak of new crown pneumonia and the oversupply situation in the global oil market, it not only severely damaged market demand, but also tested the operating capabilities of oil and gas companies. "In order to mitigate the impact of negative factors on earnings and cash flow, Petronas adjusted international capital investment and operating expenses, intending to retain cash and maintain its liquidity to cope with rapidly changing market conditions."
He also revealed that although PETRONAS continued to invest in Malaysia, the epidemic still restricted the supply chain, which severely impacted the annual performance.
**Info & Image are taken online
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