Petronas commits to paying RM19b dividend to gov't after profit surge

State energy firm Petroliam Nasional Berhad (Petronas) posted a 61 percent jump in quarterly profit on Friday and pledged to boost its dividend payout and capital spending this year.

Petronas, like other oil majors, had taken a hit from lower oil prices, but sharp cost cuts - along with some recent stability in oil prices - helped the company post higher profits and margins.

Net profit for the fourth quarter ended December rose to RM18.2 billion from RM11.3 billion in the same quarter last year, while revenue rose 13.8 percent
to RM61.8 billion.

The quarterly result helped push full-year profit up 91 percent to RM45.5 billion - marking a second year of profit growth for the sole manager of the country's oil and gas reserves following a two-year profit slump.

"Petronas is now in a stronger position to execute its long-term growth agenda," chief executive Wan Zulkiflee Wan Ariffin (in photo) said. "Petronas will explore new business areas, including speciality chemicals and new energy."

Petronas will focus on the Asean region, the Indian subcontinent, the Middle East and the Americas for growth, he said, adding that the company will assess opportunities in solar energy.

Wan Zulkiflee said the company will continue its focus on costs. Petronas, a major contributor to the country's budget and one of the country's biggest employers, said in 2016 that it would reduce expenses by US$12 billion over a four-year period and cut thousands of jobs.

The company, known to be conservative with its outlook, said its performance in 2018 will be "satisfactory", subject to the sustainability of the oil price.

It is budgeting for an oil price of US$52 per barrel in 2018.

Wan Zulkiflee said Petronas is committed to paying a dividend of RM19 billion to its sole shareholder, the government, this year compared with RM16 billion last year.

It also plans capital expenditure of around RM55 billion, higher than last year's RM44.5 billion.

--Reuters