PETRONAS Chemicals Group Berhad (PCG or the Group), announced its financial results for the fourth quarter (4Q 2024) and audited financial year ended 31 December 2024 (FY2024). 

Demonstrating PCG’s operational resilience, the Group recorded 7% higher revenue of RM30.7 billion in FY2024, on the back of sales volume growth across its three business segments. However, profitability came under pressure due to challenging market conditions. Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) declined year-on-year by 7% to RM3.5 billion due to lower spreads and higher operating cost.  Profit After Tax (PAT) was 26% lower at RM1.3 billion in line with lower EBITDA and share of loss from associates and joint ventures.

The chemicals sector downcycle has extended longer than initially anticipated, owing to stagnant global demand amid capacity oversupply. Market recovery varied across regions with geopolitical events, international trade tensions, energy cost fluctuations and climate impact contributing to the mix of economic uncertainty. Additionally, effects of significant rise in newly built capacities, especially in Northeast Asia, that is surpassing demand growth, kept pressures on prices and margins.

Compared against the preceding quarter (3Q 2024), revenue in 4Q 2024 declined by 7% to RM7.5 billion primarily due to lower average product prices and strengthening of the Malaysian Ringgit against the United States Dollar. The Group recorded Profit After Tax of RM539 million, reversing the Loss After Tax of RM762 million recorded in the previous quarter.

Commenting on the year, Mazuin Ismail, Managing Director/Chief Executive Officer of PCG said, “We met our operational targets, with plant utilisation for the O&D and F&M segments returning to above the 90% mark, despite the challenges faced earlier in the year. The Specialties segment also saw improved sales on supply constraints and improved demand for oxo and polyols.”

Market conditions are expected to remain unchanged in 2025 in view of uncertainties posed by changing geoeconomic policies and potential retaliatory actions by affected countries, in addition to ongoing geopolitical events. “We still must contend with oversupply in global petrochemical products, even as demand recovers given that capacity additions are expected to exceed demand growth by approximately 50% this year. From late 2024 and into 2025, we have observed a decline in prices and spreads in O&D, with signs that Southeast Asia integrated spreads is anticipated to remain in a trough,” Mazuin added.

“For PCG, resilience and agility are key to navigate the challenging environment. We remain focused on ensuring safe and efficient operations, keeping a close eye on the market and strengthening our financial discipline,” he concluded.