Lotte Chemical Q4 earnings up 30pct, div 23c
KUALA LUMPUR: Lotte Chemical Titan Holding Bhd (LCTH) posted a strong set of financial results for the fourth quarter ended Dec 31, 2017 with earnings of RM378.15mil.
It reported on Tuesday the earnings were up 30% from the RM290.86mil a year ago. It also announced a dividend of 23 sen a share.
LCTH attributed the higher earnings to the utilisation of current year tax incentives. However, profit before tax
fell by RM41.3mil because of margin squeeze mainly due to sharp increase in oil price and feedstock price from Q3 to Q4 2017, while product price have lagging effect to follow suit. The impact was partially offset by increase in non-operating income.
Its revenue dipped 1.3% to RM2.117bil from RM2.146bil due to reduced plant load at its Indonesia polyethylene plant and decrease in sales volume of by-product.
Earnings per share were 16.64 sen compared with 16.83 sen.
LCTH said the olefins and derivative products recorded an increase in revenue of RM46.5mil to RM502.9 mil due to an increase of 19.9% in the average selling price (ASP). However, the ASP was partly offset by the decrease in the sales volume of by-products in this segment. Profit before tax increased by RM20.2mil to RM99.7mil.
As for the polyolefin products, revenue fell by RM75.6mil to RM1.614bil. This was mainly due to lower sales volume for Indonesia polyethylene. However, the decline was partly offset by higher ASP of 7.5% in Q4 2017. Profit before tax fell by RM78.9mil to RM282.0mil mainly due to lower product margin spread.
For the financial year ended Dec 31, 2017, its earnings fell 17% to RM1.064bil from RM1.315bil in FY16. Revenue fell 3.8% to RM7.82bil from RM8.13bil mainly due to a decrease in sales volume.
The decrease was attributed to the statutory routine turnaround at its Malaysia complex and lower Indonesia polyethylene plant load due to poor polyethylene economics as a result of tight ethylene supply and high cost resulting in lower production volume. Partially offsetting the decrease in sales volume was a 17.2% increase in average product selling price.
LCTH said Profit before tax fell RM569.6mil to RM1.140bil while profit after tax fell by RM252.5mil to RM1.063bil. The decrease was mainly due to lower sales volume. There were two statutory routine turnaround activities at the Malaysia complex resulting in lower utilisation rate and higher operating cost per ton. Margin spread was also lower in the current year.
Other factors affecting the profit before tax for FY17 includes increase in share of loss in associates by RM30.5mil which was offset by IPO interest income of RM52.6mil and higher gain in foreign exchange by RM56.2mil.
It reported on Tuesday the earnings were up 30% from the RM290.86mil a year ago. It also announced a dividend of 23 sen a share.
LCTH attributed the higher earnings to the utilisation of current year tax incentives. However, profit before tax
fell by RM41.3mil because of margin squeeze mainly due to sharp increase in oil price and feedstock price from Q3 to Q4 2017, while product price have lagging effect to follow suit. The impact was partially offset by increase in non-operating income.
Its revenue dipped 1.3% to RM2.117bil from RM2.146bil due to reduced plant load at its Indonesia polyethylene plant and decrease in sales volume of by-product.
Earnings per share were 16.64 sen compared with 16.83 sen.
LCTH said the olefins and derivative products recorded an increase in revenue of RM46.5mil to RM502.9 mil due to an increase of 19.9% in the average selling price (ASP). However, the ASP was partly offset by the decrease in the sales volume of by-products in this segment. Profit before tax increased by RM20.2mil to RM99.7mil.
As for the polyolefin products, revenue fell by RM75.6mil to RM1.614bil. This was mainly due to lower sales volume for Indonesia polyethylene. However, the decline was partly offset by higher ASP of 7.5% in Q4 2017. Profit before tax fell by RM78.9mil to RM282.0mil mainly due to lower product margin spread.
For the financial year ended Dec 31, 2017, its earnings fell 17% to RM1.064bil from RM1.315bil in FY16. Revenue fell 3.8% to RM7.82bil from RM8.13bil mainly due to a decrease in sales volume.
The decrease was attributed to the statutory routine turnaround at its Malaysia complex and lower Indonesia polyethylene plant load due to poor polyethylene economics as a result of tight ethylene supply and high cost resulting in lower production volume. Partially offsetting the decrease in sales volume was a 17.2% increase in average product selling price.
LCTH said Profit before tax fell RM569.6mil to RM1.140bil while profit after tax fell by RM252.5mil to RM1.063bil. The decrease was mainly due to lower sales volume. There were two statutory routine turnaround activities at the Malaysia complex resulting in lower utilisation rate and higher operating cost per ton. Margin spread was also lower in the current year.
Other factors affecting the profit before tax for FY17 includes increase in share of loss in associates by RM30.5mil which was offset by IPO interest income of RM52.6mil and higher gain in foreign exchange by RM56.2mil.
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