Petronas anticipates lower FY2023 profit after record FY2022 as 9M profit drops amid lower oil prices

KUALA LUMPUR (Nov 29): Petroliam Nasional Bhd (Petronas), which has said since the release of its first quarter results for this year that it anticipates lower profitability for FY2023 compared to the record high earnings it scored in FY2022, reported that its net profit for its third quarter ended Sept 30 (3QFY2023) fell by 22% to RM23.9 billion from RM30.8 billion a year ago, mainly due to lower average realised prices in tandem with the declining benchmark oil prices.

Revenue declined by 16% to RM82.9 billion for 3QFY2023 from RM98.9 billion in 3QFY2022, according to the state-owned oil corporation’s quarterly financial disclosure on Wednesday.

This led to a cumulative net profit of RM64.12 billion for the first nine months of the year (9MFY2023), down 17% from RM77.2 billion in the previous corresponding period, as lower oil prices continued to weigh on revenue, which fell by 6.5% to RM251.88 billion from RM269.39 billion.

The national oil company recorded its highest annual net profit of RM101.62 billion in FY2022, more than double the RM50.87 billion it earned in FY2021, as it benefitted from elevated oil prices.

Petronas expects the volatility in oil and gas prices to continue to be elevated by persistent economic uncertainties and heightened concerns over global energy security amid geopolitical tensions in the Middle East, hence its anticipation of lower profits for FY2023 compared with FY2022.

“Petronas’ performance in the third quarter demonstrates the focused delivery of our Energy Transition strategy despite a volatile energy market,” said president and group chief executive officer Tan Sri Tengku Muhammad Taufik Kamadjaja Aziz.

“We continued to reinvest with discipline in our core and new businesses, doubling down on our efforts to ensure the security of energy supply for Malaysia and our customers around the world,” he said.

To date, Muhammad Taufik said Petronas is on track to achieve full utilisation of the 20% capital expenditure committed to intensify decarbonisation of the group’s operations and growth in new business.

“As we build on this momentum to deliver long-term sustainable value as a national oil company and continue to grow as a global energy player, Petronas remains resolute to navigate the cyclical swings in the energy market with a firm commitment to not disrupt and make every effort to provide energy that is safe, responsibly produced, cost-optimised and emissions abated,” he said.

“In the same stride, Petronas will continue to increase efforts in giving back to the societies we serve focused on investments that include empowering human capital development which saw the successful completion of MRSM Bintulu and MRSM Ranau recently. Petronas will not waver from its commitment to enriching the lives around us for a sustainable future,” he added.