KUALA LUMPUR (Nov 28): Hengyuan Refining Company Bhd posted a third quarter net profit of RM2.13 million or 0.71 sen per share, compared with a net loss of RM640.48 million or 213.49 sen per share a year earlier, thanks to a rebound in motor gas cracks and a higher stockholding gain.

Revenue for the quarter ended Sept 30, 2023 (3QFY2023) fell 51.17% to RM2.46 billion, from RM5.03 billion in 3QFY2022, mainly due to lower sales volume and lower product market prices.

In a filing to Bursa Malaysia, the crude oil refiner attributed the lower sales volume to the major turnaround exercise undertaken by the group in July and August.

On a quarter-on-quarter basis, Hengyuan turned to profit from a net loss of RM95.51 million in 2QFY2023 on the back of stronger cracks for all main products and a higher stockholding gain, while revenue dropped 30.63% from RM3.54 billion, dragged down by lower sales volumes.

For the first nine months of FY2023, Hengyuan recorded a net loss of RM213.92 million, against a net profit of RM74.46 million in the same period last year, due to the lower cracks for gasoil and Jet A1, while revenue decreased 38.5% to RM10.38 billion from RM16.88 billion.

Hengyuan said the turbulence in the global oil market due to geopolitical tensions and ongoing wars could upset the delicate balance between crude oil supply and demand, which will affect the cracking margin.

"The company is actively monitoring the current market conditions and will continue its efforts to focus on operational efficiency, product quality, hydrocarbon hedging and financial risk management to optimise its performance," it said.

Hengyuan shares closed one sen or 0.32% lower at RM3.16 on Tuesday, valuing the group at RM948 million.