KUALA LUMPUR (April 28): Lotte Chemical Titan Holding Bhd reported today its highest-ever quarterly profit after tax at RM441.28 million in the first quarter ended March 31, 2021 (1QFY21) versus a loss after tax of RM169.5 million a year earlier as the petrochemical products manufacturer’s revenue rose due to the increase in average product selling price and sales volume in tandem with the Covid-19 vaccine-driven global economic recovery.
In filings with Bursa Malaysia today, Lotte Chemical Titan said 1QFY21 profit rose on higher average product selling price and lower feedstock costs and as plant utilisation rate increased.
Lotte Chemical Titan said 1QFY21 net profit rose to RM440 million from a net loss of RM170.06 million a year ago as revenue climbed to RM2.37 billion from RM1.46 billion.
"The group's profit before tax has improved by 376% from a loss before tax of RM205.8 million to profit before tax of RM567.1 million. This is mainly due to the improved margin spread resulting from higher average product selling price and lower feedstock costs. The gross profit margin has improved from (14%) to 23%,” the company said.
Lotte Chemical Titan's profit and revenue also rose in quarterly terms during 1QFY21. The firm said 1QFY21 revenue increased to RM2.37 billion from RM1.92 billion in 4QFY20.
Plant utilisation rate was higher at 88% in 1QFY21 compared with 85% in 4QFY20, according to the company.
"The group's profit before tax of RM567.1 million was more than double the amount recorded in 4QFY20 of RM202.2 million mainly due to improved margin spread," Lotte Chemical Titan said.
Looking ahead, Lotte Chemical Titan said its FY21 operating results are expected to be primarily influenced by factors including the demand and supply balance of petrochemical products in the market and the company's ability to maximise petrochemical product output and operational efficiency.
Lotte Chemical Titan said it has also taken into consideration petrochemical product demand in tandem with global economic growth and "feedstock prices which are correlated to crude oil prices".
At Bursa's 12.30pm break today, Lotte Chemical Titan's share price fell eight sen or 2.75% to RM2.83, which values the counter at about RM6.42 billion.
Lotte Chemical Titan has 2.27 billion issued shares, according to its latest quarterly financial report.