KUALA LUMPUR (Jan 27): Lotte Chemical Titan Holdings Bhd’s fourth quarter net profit nearly doubled from the third quarter on improved margin spreads, on the back of higher average product selling prices.

In a bourse filing, the chemical manufacturer said net profit for the fourth quarter ended Dec 31, 2020 (4QFY20) increased to RM151.16 million, from RM78.77 million in 3QFY20.

Revenue however fell to RM1.92 billion from RM1.94 billion in 3QFY20 following a decrease in sales volume on lower production volume. The group said its plant utilisation rate was 85% in 4QFY20 compared with 90% in 3QFY20 due to plant maintenance.

On a year-on-year basis, the net profit was down 19.49% compared with RM187.76 million in 4QFY19, while revenue dropped to RM1.92 billion from RM1.97 billion.

The group said full-year net profit slumped to RM148.59 million from RM439.73 million in FY19, while revenue declined 18% to RM6.90 billion from RM8.44 billion.

In a statement, Lotte Chemical Titan president and CEO Park Hyun Chul said the group had a positive operating cash flow of some RM1.1 billion in FY20, and a strong cash position of RM4.2 billion.

“We are pleased to be able to play a role in combating the Covid-19 pandemic in Malaysia. As we are designated as an essential service which provides vital raw materials for the production of plastic packaging and healthcare equipment in Malaysia, we are able to continue our operations to supply key raw materials to our customers throughout the movement control order period,” he said.

Park said the industry outlook would remain challenging, and that the group would continue to focus on operational and financial performance optimization initiatives.

“Notwithstanding the current headwinds, we will continue to be vigilant and explore value-accretive opportunities to further drive our growth. At the same time, we will remain steadfast to focus on our key growth strategies to achieve our vision of becoming a top-tier petrochemical company in Southeast Asia,” he added.

Lotte Chemical Titan’s share price was 6.42% or 17 sen lower at RM2.48 in afternoon trades, giving a market capitalisation of RM5.72 billion. The counter saw 7.51 million shares traded.