DOHA: Mesaieed Petrochemical Holding Company (MPHC), a subsidiary of Qatar Petroleum and one of the region’s premier diversified petrochemical conglomerates, recorded a net profit of QR1.1bn for the full year ended December 2015.
Total income reported for the year, including the tax refund was QR1.1bn, a decrease of QR707m, or 39 percent, versus the same period of 2014. The decline is primarily due to planned facility maintenance in the current year and weaker product prices following the significant fall in the global oil prices in Q4, 2014 that started to affect product prices.
MPHC’s QR1.1bn net profit reflects a decrease of QR0.7bn, or 39.5 percent, over the same period in 2014, while the fourth quarter earnings of QR300.8m were down by 21.5 percent over the third quarter of 2015. The year-on-year reduction was driven by planned major maintenance shutdowns and due to weak product prices.
The preventive maintenance and warranty shutdowns are an essential requirement for large, industrial plants as they can help minimise unplanned disruption, ensure product quality is maintained and ultimately, contribute to an extension of plant’s production life.
The quarter-on-quarter decrease was due to decrease in selling prices and sales volumes. The groups’ profit was also aided by recognition of a tax refund of QR100.1m for the year. The group continued to benefit from the supply of competitively priced ethane feedstock and fuel gas under long-term supply agreements. This contracting arrangement is an important value driver for the group profitability in a challenging market condition.
The company’s liquidity position remained strong during the year on buoyant cash realisation ratios across all group companies, with cash held by the company after distribution of previous years dividend of QR1.3bn, was at QR926m. The total assets at December 31, 2015 was QR14.3bn, compared to the December 31, 2014 total assets of QR14.6bn.
Due to the unfavourable conditions experienced during the year, the group closed the year with 9.6 percent less than the budgeted profit, MPHC said.
The Board of Directors aim to maximise the percentage of net profit paid as a cash dividend while maintaining adequate liquidity for the group’s capital investments, working capital and financing needs, and the principles of financial prudence.
After ensuring sufficient cash is maintained for working capital, debt repayment and capital expenditure, and keeping in view the latest economic forecasts, the Board of Directors, in their meeting yesterday recommended a total annual dividend distribution for the full year 2015 of QR879.4m.
This is equivalent to a payout of QR0.7 per share and represents 80.9 percent of the group’s profits.
The Board of Directors and senior management look forward to 2016 with renewed confidence in the sound financial and operational position of the group, and continued strong support from our esteemed shareholders.
