PETRONAS Chemicals : PCG's 27th Annual General Meeting 22 April 2025 - Live Q&A

About this update from Petronas Chemicals Group Bhd.

PETRONAS Chemicals Group Berhad 27'h Annual General Meeting No. Question 1. a) What is the total amount invested in the Pengerang project? b) Is the depreciation cost consolidated into the balance sheet or is it only reflected in the share of profit? c) The share of profit from Associates and JVs changed from a profit of RM93 million to a loss of RM107 million. Is this due to the Pengerang project? Answer to Question 1 (a) - 1 (c) a) PCG has 50% interest in the Pengerang Petrochemical Company Sdn. Bhd. with the total project cost of RM10 billion (PCG's 50% portion). b) The depreciation cost is consolidated into the group's profit and loss rather than the share of profit. Total depreciation cost for Pengerang is around RM400 million per year. As depreciation started in July 2024, the 2024 report reflects only half of the yearly depreciation. c) As the Pengerang project is a joint operating entity, its results are recorded in the group's profit and loss and does not impact share of profit movements for Associates and JVs. The loss of RM107 million is mainly due to lower financial performance from other Associates and JV companies such as BASF PETRONAS Chemicals Sdn. Bhd., LG PETRONAS Chemicals Malaysia Sdn. Bhd. and PCG PCC Oxyalkylates Sdn. Bhd., as a result of adverse market conditions as well as some of the companies are in the early stage of their operations. No. Question 2. a) Before the tariffs imposed by Trump, the market was already facing oversupply, margin compression, and rising energy costs. Given the new tariffs, do you feel the situation has worsened? Reports suggest China may dump its excess capacity into Southeast Asia. Additionally, do Chinese producers have a competitive advantage with cheaper Russian oil and lower production costs? Lastly, are there tariffs in place to protect the domestic market from Chinese imports? b) Do Chinese producers have a lower feedstock cost than PCG in general? Answer to Question 2 (a) - 2 (b) a) CEO: We are assessing the impact and implications of the US tariff to the market. Potentially, there will be impact to PCG and other chemical players, as some of the products may flow into our key markets, such as Southeast Asia. In response, we are focusing on maintaining competitiveness and resilience in this challenging market. Our strategy involves ensuring optimal performance of our facilities, fostering strong c...

View stock analysis, news, and events for Petronas Chemicals Group Bhd.