Gas Malaysia’s Q2 2025 Results: Navigating Market Headwinds While Rewarding Shareholders
Gas Malaysia Berhad has released its financial results for the second quarter ending June 30, 2025. The report paints a picture of a company navigating a challenging economic landscape marked by fluctuating energy prices. While headline figures show a decline compared to the same period last year, a deeper dive reveals operational resilience and a continued commitment to shareholder returns, highlighted by a newly declared dividend.
Let’s break down the key numbers and what they mean for the company moving forward.
Core Financial Highlights: A Tale of Price vs. Volume
The second quarter of 2025 saw Gas Malaysia’s financial performance influenced primarily by lower average natural gas selling prices. However, the company managed to partially offset this through an increased volume of natural gas sold and higher tolling fees, indicating sustained demand for its services.
Q2 2025 (Current Quarter)
- Revenue: RM 1.80 billion
- Profit Before Zakat & Taxation: RM 132.5 million
- Net Profit: RM 99.1 million
- Earnings Per Share (EPS): 7.72 sen
Q2 2024 (Comparative Quarter)
- Revenue: RM 1.98 billion
- Profit Before Zakat & Taxation: RM 150.1 million
- Net Profit: RM 110.1 million
- Earnings Per Share (EPS): 8.57 sen
The Group’s revenue for Q2 2025 saw a 9.2% decrease compared to the corresponding quarter last year. This was primarily driven by a lower average natural gas selling price. Profit before zakat and taxation also declined by 11.8%, attributed to a combination of lower gas contribution margins, higher administrative expenses, and increased finance costs. On a positive note, these impacts were softened by higher sales volume and an increased share of results from its joint venture companies.
Year-to-Date Performance
Looking at the first six months of 2025, the trend is similar. The cumulative performance reflects the ongoing market conditions.
| Financial Metric (6 Months Ended 30 June) | 2025 | 2024 | Variance |
|---|---|---|---|
| Revenue (RM’000) | 3,647,096 | 3,857,374 | -5.5% |
| Profit Before Zakat & Taxation (RM’000) | 265,348 | 286,683 | -7.4% |
| Net Profit (RM’000) | 199,257 | 212,684 | -6.3% |
| Earnings Per Share (Sen) | 15.52 | 16.56 | -6.3% |
Good News for Shareholders: Dividend Declared!
Despite the dip in profits, the Board of Directors has declared a first interim dividend of 6.00 sen per share for the financial year ending 31 December 2025. This dividend, amounting to RM77.0 million, will be paid on 31 October 2025, reaffirming the company’s commitment to delivering value to its shareholders.
Risks and Prospects: A Cautious Outlook for 2025
Gas Malaysia is operating within a broader economic context of caution. Bank Negara Malaysia (BNM) has recently revised its 2025 GDP growth forecast downwards to a range of 4.0% to 4.8%. This adjustment, coupled with a recent 25-basis-point cut in the Overnight Policy Rate (OPR) to 2.75%, signals concerns over rising external challenges and moderating domestic momentum.
The company acknowledges several downside risks on the horizon, including:
- Potential disruptions in international trade.
- Weaker-than-expected global demand.
- Lower commodity output affecting the industrial sector.
In response, the Group’s strategy is clear: focus on what it can control. Gas Malaysia will continue to implement prudent measures aimed at enhancing operational efficiency, improving its competitive edge, and actively pursuing strategic growth opportunities. With these initiatives, the Board remains confident in delivering a satisfactory performance for the financial year 2025, while maintaining a watchful eye on market uncertainties.
Summary and Outlook
In summary, Gas Malaysia’s second-quarter results reflect a company adeptly managing external pressures. The decline in revenue and profit is largely tied to market-driven gas prices rather than a fundamental weakness in its core operations, as evidenced by the growth in sales volume. The management’s focus on efficiency and strategic growth, combined with a stable dividend policy, provides a degree of stability in an uncertain economic climate.
Key points for investors to consider:
- Price vs. Volume Dynamics: The core challenge remains managing profitability when selling prices are low. The ability to increase sales volume is a key strength that helps mitigate this.
- Cost Management: A rise in administrative and finance costs has impacted the bottom line. Close monitoring of these expenses will be crucial for margin protection.
- Economic Headwinds: The broader economic slowdown forecasted by BNM could impact industrial demand, which is a key market for Gas Malaysia.
- Shareholder Returns: The consistent declaration of dividends remains a major positive, signaling financial health and a shareholder-friendly policy.
Final Thoughts
While the year-on-year decline in headline numbers may seem concerning, a deeper look reveals operational resilience. The increase in sales volume suggests sustained demand, a positive sign for the core business. The key challenge ahead will be to navigate the volatile energy price environment and control internal costs effectively. The company’s proactive strategies and commitment to dividends offer a solid foundation as it moves through the rest of 2025.
Do you think Gas Malaysia can maintain this growth momentum in sales volume for the rest of the year? Share your views in the comments below!
