Doha: Mesaieed Petrochemical Holding Company (MPHC), yesterday announced a net profit of QR1.4bn for the nine-month period ended September 30 2021, representing an increase of 335 percent compared to the same period last year. The Group's revenue improved by 88 percent to reach QR3bn, compared to QR1.6bn for 9M-20. While earnings per share (EPS) grew to QR0.114 from QR0.026.
Constructive macroeconomic drivers carried forward from the latter part of last year, on the back of satisfactory vaccination drive linking to easing out of lockdowns in major markets, led to a sequential recovery in demand for petrochemicals and chlor-alkali products, and positively reflected on the commodity prices. Industry-wide supply constraints marked by extreme weather calamities and global logistical bottlenecks also played a part in keeping the product prices favourable. Although, petrochemical prices have softened specifically in the later part of Q2-21 following improved supply, but overall year-to-date price trajectory remained buoyant.
MPHC’s operations continue to remain robust and resilient with total production for the period reaching 891000 MTs, up by 22 percent versus 9M-20, mainly due to improved plant operating rates during 9M-21. During the period, blended product prices on an average increased by 56 percent compared to 9M-20, translating into an increase of QR1.1bn in MPHC’s bottom line earnings, compared to the same period last year.
Renewed product demand supplemented by supply constraints resulted in improved commodity prices. Sales volumes increased by 20 percent versus 9M-20, driven by improved plant operating rates. The overall growth in sales volumes translated into an increase of QR307m in MPHC’s bottom line earnings.
Compared to Q2-21, MPHC revenue improved by 5 percent, while net profit remained flat. However, selling prices declined by 3 percent during Q3-21 compared to Q2-21, mainly on account of supply side ease outs particularly for the petrochemical products.
Liquidity remained robust with cash and cash equivalents reaching QR3.2bn as at September 30, 2021. Total assets amounted to QR17.0bn and total equity stood at QR16.7bn.
Petrochemicals segment reported a net profit of QR1.0bn for 9M-21, up by 327 percent versus 9M-20. This notable increase in profitability was primarily driven by improved product prices owing to improved macro environment and supply shortages. Sales volumes also increased by 17 percent, compared to the same period last year.
The growth in product prices coupled with improved sales volumes led to an overall rise in revenue by 75 percent within the segment, to reach QR2.1bn for the current period. Production volumes also increased by 21 percent.
Chlor-alkali segment reported a net profit of QR418m for 9M-21, increased significantly compared to the same period of last year. This notable growth was primarily driven by a significant improvement in blended average selling prices, which increased by 85 percent versus 9M-20, complemented by renewed demand of end products (PVC, aluminium, polymers).
On a quarter-on-quarter basis, profitability improved by 29 percent mainly on account of continued strong selling price trajectory which increased by 9 percent versus Q2-21, coupled with 11 percent increase in sales volumes. Growth in selling prices and sales volumes led to 21 percent increase in segmental revenue for Q3-21 versus last quarter.
MPHC will host an IR earnings call on November 2, at 1:30pm Doha Time.
