KUALA LUMPUR, Nov 26 — Petroliam Nasional Bhd’s (Petronas) net profit nearly halved to RM7.42 billion in the third quarter ended September 30, 2019 (Q3 2019) from RM14.34 billion in the same period last year.

In a statement today, Petronas said the lower earnings were primarily due to lower revenue and net impairment on assets, which were partially offset by lower net product and production costs, as well as lower tax expenses.

Revenue in Q3 2019 declined to RM55.11 billion from RM63.91 billion previously, primarily due to lower average realised prices for major products and reduced sales volume predominantly for crude oil and condensates, it said.

“However, this was partially offset by the effect of the weakening ringgit against the US dollar exchange rate,” said the national oil company.

Earnings before interest, tax, depreciation, and amortisation (EBITDA) stood at RM18.8 billion, in line with the lower pre-tax profit of RM47.13 billion (Q3 2018: RM56.31 billion), it added.

For the first nine-month period, the group’s net profit stood at RM36.36 billion, a decrease of 11 per cent from RM40.99 billion in the same period in 2018, mainly due to lower revenue and net impairment predominantly recognised in its exploration and production segment.

“The segment was driven by more conservative price outlook, and partially offset by lower tax expenses,” it said, adding that EBITDA slipped seven per cent to RM73.5 billion for the cumulative period ended September 30, 2019.

On capital investments, Petronas said it allocated RM28.9 billion from January to September 2019, while for Q3 2019, the capital investments amounted to RM12.0 billion, mainly attributed to upstream projects.

“Total assets decreased to RM621.4 billion as at September 30, 2019 as compared with RM636.3 billion as at December 31, 2018,” it said.

On outlook, the company expects the industry to remain challenging due to slowing global economy, geopolitical tensions, and ongoing global trade issues, resulting in demand disruption.

“The board expects the overall year-end performance of the group to be affected by these factors,” it said.

Meanwhile, president and group chief executive officer Tan Sri Wan Zulkiflee Wan Ariffin said despite persistent market volatility, Petronas’ performance in Q3 2019 demonstrated its resilience and ability as an integrated energy player in sustaining strong and reliable operations throughout the period.

“We will remain focused on driving operational efficiency and commercial excellence across the group in resolute execution of our three-pronged strategy.

“While our performance will continue to be impacted by the challenging environment, Petronas’ financial position is expected to remain robust,” he said. — Bernama