KUALA LUMPUR (May 6): Gas Malaysia Bhd’s earnings for the financial year ending Dec 31, 2021 (FY21) may decline from FY20 amid a predicted drop in average gas selling price, said CGS-CIMB.
In a note today, its analyst Ngo Siew Teng said the lower selling price could in turn affect its shipper unit profits.
However, she pointed out that “there could be potential earnings upside if the average gas selling price is revised up in future according to market prices (2020: RM33.65/MMBtu vs. Jan-Jun 2021: RM24.50/MMBtu)”.
Gas Malaysia expected its gas volume for FY21 to grow in line with Malaysia’s gross domestic product (GDP) growth, which Bank Negara Malaysia has forecast to range from 6% to 7.5%.
posted a higher net profit of RM55.63 million in the first quarter ended March 31, 2021 (Q1 2021) against RM47.86 million registered in the same quarter last year.
Revenue, however, fell 28.2 per cent to RM1.15 billion from RM1.61 billion previously. This was in line with the lower average tariff mitigated by higher volume of natural gas sold during the current quarter,” it said in a filing with Bursa Malaysia today.
The company said profit before zakat and taxation increased 7.1 per cent to RM72.1 million in Q1 2021 from RM67.4 million in the corresponding period last year, mainly due to higher gross profit in line with the higher volume of natural gas sold in the current quarter but offset by higher overheads and depreciation being part of cost of sales.
will focus on strengthening its presence in the gas industry value chain in the financial year 2021 (FY21) to move further ahead into the new regime that resulted from market liberalisation which has intensified competition in the industry.
Chairman Datuk Hasni Harun said to mitigate this impact, the group will also focus on enhancing efficiencies through cost savings, optimising operations, and fostering sustainable growth by embracing new businesses that can add further value to the group.
“The group is hopeful that the global economy will be better and more stable in FY21 in tandem with the global and country’s rollout of vaccines, which will reduce the negative impact of the pandemic.