Under the aims of delivering value to stakeholders, PETRONAS Chemicals Group Berhad (PCG) had ventured through a global economic growth scenario which had slowed, influenced by geopolitical tensions and China’s sluggish post-pandemic recovery last year.
High energy costs and product oversupply worsened the industry’s downturn, with soft demand across the chemicals sector. Additionally, the Company’s commodities business faced internal and external challenges which affected plant utilisation, resulting in lower production.
PCG, today held its 26th Annual General Meeting (AGM) to present the Company’s performance to its shareholders for its Financial Year Ended 31 December 2023.
The AGM was chaired by PCG Chairman, Datuk Ir. (Dr.) Abdul Rahim Hashim, with the Board members, PCG Managing Director/Chief Executive Officer, Mazuin Ismail and also Chief Financial Officer, Mohd Azli Ishak in attendance. During the AGM, Mazuin shared the Company’s performance, growth plans, sustainability agenda, and outlook for 2024.
“Despite the challenges faced, with the diligent implementation of our strategic initiatives, we recorded a production volume of 10.4 million tonnes, including commodities and specialty chemicals, sales volume of 9.6 million tonnes while maintaining its track record on safety. We closed 2023 with a revenue of RM28.7 billion and profit after tax of RM1.8 billion,” said Mazuin.
The company paid a total dividend of 13 sen per share amounting to a total payout of RM1 billion, representing 61% dividend payout ratio.
Delivering growth
PCG’s growth performance has remained stable over the years, supported by its strong financial position. In 2023, among others, the Company achieved Ready for Start-Up (RFSU) phase for two plants; a specialty ethoxylates and polyether polyols plant in Kertih, Terengganu, and a nitrile butadiene latex (NBL) plant in Pengerang, Johor.
The plant in Kertih will enable PCG to meet the growing demand for foam products in the automotive sector, cleaning and personal care products while the production of NBL allows PCG to capture opportunities in the global latex glove market, given Malaysia’s status as the largest glove producer in the world.
There were also several new developments under PCG’s specialty chemicals platform, through its subsidiaries, Perstorp Group (Perstorp) and BRB Group (BRB). Perstorp completed the construction of its Sayakha plant in India in 2023 for Pentaerythritol (Penta) production and International Sustainability and Carbon Certification (ISCC) PLUS certified VoxtarTM M40 to strengthen its market position in the Asia Pacific region.
BRB meanwhile strengthened its capabilities with entry into the food industry through its key certifications for food safety in Malaysia. In addition, BRB has significantly expanded its global footprint and started full operations of its new Lube Oil Additives & Chemicals (LAC) plant in the Netherlands, while strengthening its market presence in the UK and South Korea.
Committed to advancing sustainability agenda
In 2023, PCG made a significant step forward in its Circular Economy agenda to contribute to a sustainable plastics ecosystem by sanctioning the construction of an advanced chemical recycling plant in Pengerang, Johor. The end-of-life plastic for this plant will be collected throughout Malaysia, as it aims to reduce plastic waste ending up in landfills. .
This recycling plant will be able to give a new lease of life to what is otherwise typically end-of-life plastic into pyrolysis oil that can then be used as feedstock in the production of circular plastics.
The chemical industry plays a key role in developing technologies and sustainable solutions that support the transition to a low carbon economy. In addition, PCG, through its specialty chemicals subsidiary Perstorp, continues to grow its sustainable product portfolio with the launch of five new ISCC PLUS certified products such as 2-EH Pro 100 and Valeric Acid Pro 100, which have low carbon footprint and are made from 100% renewable content.
On PCG’s sustainability journey, Mazuin said, “We are pleased to have made good progress on our sustainability ambitions. However, there is still much work to be done as we strive to further integrate sustainability into more aspects of our operations. We remain steadfast in our commitment to reduce our environmental footprint and continue to pursue our net zero emissions ambition, in line with our Net Zero Carbon Emissions (NZCE) 2050 Roadmap.”
“2024 will continue to be challenging but we are committed to strengthening our operational performance with our plant reliability strategy which includes asset risk prioritisation and proactive maintenance implementation to mitigate unplanned events.
“We will also continue fostering stronger relationships with our customers to ensure we deliver the products and solutions in keeping with dynamic market demand. In addition, we will advance our sustainability efforts and explore new growth opportunities.
Through these efforts, PCG will be well-positioned and nimble to capture opportunities during the anticipated economic upcycle when the demand catches up with supply,” added Mazuin.
