Doha: Mesaieed Petrochemical Holding Company (MPHC), yesterday announced a net profit of QR1.5bn for the nine-month period ended September 30, 2022, showing an increase of 2 percent compared to QR1.4m during the same period last year (9M-21).
Group revenue improved by 3 percent to reach QR3.1bn, as compared to QR3.0bn for 9M-21. Earnings per share (EPS) amounted to QR0.117 for the nine-month period ended September 30, 2022, compared to QR0.114 during the same period last year.
Year-to-date results reflected constructive product price momentum from last year, however, macroeconomic headwinds weighed on third quarter results compared to previous quarter.
MPHC showed robust liquidity position with closing cash and bank balances amounting to QR4.0bn as of September 30, 2022. It may also be noted that the Council of Ministers has approved increasing the ownership percentage of non-Qatari shareholders in MPHC up to 100 percent.
EBITDA for the current period amounted to QR1.8bn with a marginal increase of 2 percent versus 9M-21, mainly due to improvement in revenue. EBITDA margins for 9M-22 reached 57 percent versus 58 percent achieved during 9M-21.
Macroeconomic climate remained wavered throughout the year marked by geopolitical conflicts and recessionary fears linked to inflationary pressures and higher interest rate environment.
On overall, commodity prices declined on a quarter-on-quarter basis, mainly due to cautious approach from buyers amid macro-headwinds, coupled with comparatively lower crude prices.
However, product prices for the Group’s basket of products remained strong versus last year. MPHC’s operations continue to remain robust and resilient with total production for the nine-month period reaching 850 thousand MTs. Nine-month’s production for the current year declined by 5 percent versus same period of last year, mainly due to a large-scale turnaround carried out at Q-Chem’s facilities during 1Q-22.
During the period, average blended product prices increased by 6 percent compared to 9M-21, translating into an increase of QR253m in MPHC’s net earnings, as compared to 9M-21. Sales volumes decreased by 3 percent versus 9M-21, mainly driven by lowered plant operating rates, amid large scale turnaround carried at Q-Chem facilities during 1Q-22. Decline in sales volumes translated into a decrease of QR160m in MPHC’s net earnings.
Compared to 2Q-22, MPHC revenue decreased by 14 percent and net profit declined by 27 percent. Key contributor towards the downward trend in revenue and net earnings was mainly lower selling prices realised during the current period versus 2Q-22. However, sales volumes improved by 12 percent compared to 2Q-22, despite demand related concerns, where both the segments reported growth in sales volumes in comparison to the previous quarter.
Liquidity remained robust with cash and bank balances standing at QR4.0bn as at September 30, 2022. Total assets as at September 30, 2022 amounted to QR17.5bn and total equity amounted to QR17.2bn as at September 30, 2022.
Petrochemicals segment reported a net profit of QR966m for 9M-22, down by 4 percent versus 9M-21. On a quarter-on-quarter basis, segmental profits declined by 28 percent, mainly linked to lower selling prices realised during 3Q-22, down by 17 percent versus 2Q-22.
Chlor-alkali segment reported a net profit of QR471m for 9M-22, increased by 12 percent compared to the same period of last year. On a quarter-on-quarter basis, profitability declined by 32 percent mainly on account of lower segmental revenue which declined by 15 percent versus 2Q-22.
In accordance with the proposed amendments to the Articles of Association approved during the Company’s Extraordinary General Assembly meeting held in March 2022, the Board of Directors can decide on the foreign ownership limit, as per applicable laws and regulations, and may increase the foreign ownership limit up to 100 percent. Accordingly, a decision was made by the Company’s Board of Directors at its meeting held in April 2022 to increase the ownership limit for non-Qatari shareholders to 100 percent.
Pursuant to a decision made by the Council of Ministers in its meeting held on October 12, 2022, it was approved to increase the percentage of ownership of a non-Qatari investor in the Company’s capital up to 100 percent. All necessary measures will be taken in this regard with the relevant authorities. MPHC will host an IR earnings call with investors to discuss its results, outlook and other matters on November 1, 2022 at 1:30pm Doha Time. The IR presentation that accompanies the conference call will be posted at MPHC’s website.
