KUALA LUMPUR (Aug 20): Petronas Gas Bhd’s net profit for the second quarter ended June 30, 2024 (2QFY2024) fell 3.4% year-on-year, dragged by higher maintenance and depreciation expenses, and offset by higher revenue and lower forex losses.

Net profit in the quarter fell to RM469 million or 23.7 sen per share, from RM485.4 million or 24.53 sen per share, the country's largest gas pipeline network operator said on Tuesday.

The higher expenses in the quarter were attributed to "higher completion of projects and activities performed", coupled with inflationary impact, PetGas said.

Quarterly revenue inched up 0.7% year-on-year to RM1.65 billion from RM1.64 billion, mainly due to higher gas processing and transportation revenue amid higher charges and tariffs.

This as quarterly revenue in the utilities segment slipped due to reduced product prices, PetGas said.

The company declared a second interim dividend of 16 sen, payable September 19, bringing the total dividend for the first six months of FY2024 (1HFY2024) to 32 sen, unchanged from last year.

For 1HFY2024, PetGas posted an 11.8% increase in net profit to RM925.6 million, up from RM909.6 million in the previous January-June period.

The company attributed this to reduced financing costs and forex exposure on early repayment of its US dollar lease liabilities, though it was partially offset by lower contributions from joint ventures while group revenue also fell.

Meanwhile, half-year revenue slipped 1.4% to RM3.27 billion from RM3.31 billion, mainly due to lower sales prices in the utilities segment although volume rose.

Looking ahead, PetGas expects the elevated Malaysia Reference Price, a benchmark for local gas prices which correlates with fuel gas price movements, to impact the utilities segment’s performance.

However, the company remains focused on cost efficiency to mitigate rising operating costs and anticipates minimal impact from foreign exchange fluctuations following the settlement of lease liabilities for its floating storage units in May 2023.

“Our results demonstrate PetGas’ continued operational excellence. We are poised to maintain our strong performance throughout the remainder of 2024,” said group managing director and chief executive officer Abdul Aziz Othman.

PetGas' shares gained two sen or 0.11% to RM18.18 on Tuesday, valuing the company at RM35.97 billion. The counter is up more than 4% this year.