KUALA LUMPUR (April 24): Petronas Chemicals Group Bhd is focused on advancing its growth initiatives and strengthening its operational performance, despite the expectation that 2024 will continue to be a challenging year.

The company said it is committed to strengthening its operational performance with the plant reliability strategy, which includes asset risk prioritisation and proactive maintenance implementation to mitigate unplanned events.

Managing director and chief executive officer Mazuin Ismail said Petronas Chemicals will also continue fostering stronger relationships with its customers to ensure it delivers products and solutions in keeping with the dynamic market demand.

“In addition, we will advance our sustainability efforts and explore new growth opportunities.

“Through these efforts, PCG (Petronas Chemicals) will be well-positioned and nimble to capture opportunities during the anticipated economic upcycle, when the demand catches up with supply,” he said in a statement after its annual general meeting on Wednesday.

In 2023, the group noted that global economic growth had slowed, influenced by geopolitical tensions and China’s sluggish post-pandemic recovery, with high energy costs and product oversupply worsening the industry’s downturn, alongside 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, Petronas Chemicals said in the statement.

“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 speciality chemicals, and a sales volume of 9.6 million tonnes, while maintaining a track record on safety.

“We closed 2023 with a revenue of RM28.7 billion and profit after tax of RM1.8 billion. The company paid a total dividend of 13 sen per share, amounting to a total payout of RM1 billion, representing a 61% dividend payout ratio,” Mazuin said.

He also pointed out that Petronas Chemicals’ growth performance has remained stable over the years, supported by its strong financial position.

In 2023, among other milestones, Petronas Chemicals achieved the ready for start-up (RFSU) phase for two plants — a speciality ethoxylates and polyether polyols plant in Kerteh, Terengganu, and a nitrile butadiene latex (NBL) plant in Pengerang, Johor.

The plant in Kerteh will enable Petronas Chemicals to meet the growing demand for foam products in the automotive sector, cleaning and personal care products, while the production of NBL allows Petronas Chemicals to capture opportunities in the global latex glove market, given Malaysia’s status as the largest glove producer in the world, it said.

There were also several new developments under Petronas Chemicals’ speciality chemicals platform, through its subsidiaries Perstorp Group and BRB Group, the company said.

Petronas Chemicals also noted that the chemical industry plays a key role in developing technologies and sustainable solutions that support the transition to a low-carbon economy.

In 2023, Petronas Chemicals 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, the company shared.

In addition, through its speciality chemicals subsidiary Perstorp, Petronas Chemicals continues to grow its sustainable product portfolio with the launch of five new ISCC PLUS certified products, such as the 2-EH Pro 100 and Valeric Acid Pro 100, which have low carbon footprint and are made from 100% renewable content.

“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,” Mazuin added.