KUALA LUMPUR (Nov 29): Hengyuan Refining Co Bhd slipped into the red again in the third quarter ended Sept 30, 2022 (3QFY2022), after three consecutive quarters of profit, on adverse refining margin.
The group attributed the adverse refining margin to a sharp reduction in cracks especially for motor gas, as well as a higher crude premium incurred and increase in stockholding losses due to a significant drop in product prices.
On a year-on-year basis, quarterly net loss widened by nearly 12 times to RM640.48 million from RM54.04 million, Hengyuan said in a stock exchange filing.
Revenue grew 55% to RM5.03 billion from RM3.25 billion in 3QFY2021 thanks to a surge in market product prices, the group said.
For the cumulative nine months ended Sept 30, 2022, the oil refinery group recorded a net profit of RM74.46 million versus a net loss of 97.11 million in the previous corresponding period, while revenue more than doubled to RM16.88 billion from RM7.95 billion.
Going forward, Hengyuan said it will continue its efforts to focus on operational efficiency, product quality, hydrocarbon hedging and financial risk management to optimise its performance.
“Uncertainties in the global market continue to cause turbulence to the industry. Oil price volatility may persist as the market sentiments are affected by the ongoing geopolitical tensions and global recession fears, coupled with the production output cut by the Organization of the Petroleum Exporting Countries members,” it said.
Shares of Hengyuan closed five sen or 1.11% higher at RM4.55 per share on Tuesday (Nov 29), giving the group a market capitalisation of RM1.36 billion.
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