Greetings, fellow investors and market watchers! We’re diving deep into the latest financial report from PETRONAS Dagangan Berhad (PDB) for the first quarter ended 31 March 2025. This report offers a compelling glimpse into the company’s operational resilience and strategic maneuvers amidst evolving market conditions. While revenue saw a slight dip, PDB managed to significantly boost its profitability, demonstrating effective cost management and a keen eye on market opportunities. What truly stands out is the impressive increase in Profit Before Taxation and a solid dividend announcement, signaling confidence from the board. Let’s break down the numbers and see what’s driving PDB’s performance.
Q1 2025 Financial Highlights: A Story of Profitability
PDB’s first quarter results for 2025 showcase a strong improvement in profitability despite a slight revenue contraction. The Group recorded a notable increase in Profit Before Taxation (PBT) and Net Profit, reflecting effective management and a favorable market environment for certain segments.
Q1 2025 Performance
Revenue: RM9,093.0 million
Operating Profit: RM407.4 million
Profit Before Taxation: RM409.2 million
Profit for the Period (Net Profit): RM301.1 million
Profit Attributable to Shareholders: RM293.5 million
Earnings Per Share: 29.5 sen
Q1 2024 Performance
Revenue: RM9,393.1 million
Operating Profit: RM343.2 million
Profit Before Taxation: RM326.8 million
Profit for the Period (Net Profit): RM232.9 million
Profit Attributable to Shareholders: RM226.0 million
Earnings Per Share: 22.8 sen
The Group’s revenue for Q1 2025 stood at RM9,093.0 million, a 3% decrease compared to RM9,393.1 million in the corresponding quarter last year. This was primarily due to a 2% drop in sales volume coupled with a 1% lower average selling price. However, the impressive story lies in the profitability metrics:
- Profit Before Taxation (PBT) surged by 25% to RM409.2 million from RM326.8 million in Q1 2024. This significant improvement was mainly driven by lower expenditure across all segments and marginal improvements in gross profit, further supported by favorable price trends in the Commercial segment.
- Net Profit also saw a substantial increase, rising by 29% to RM301.1 million from RM232.9 million in Q1 2024.
- Earnings Per Share climbed to 29.5 sen, up from 22.8 sen in the same period last year, reflecting the stronger earnings attributable to shareholders.
Segmental Performance: A Closer Look
PDB operates across three main business segments: Retail, Commercial, and Convenience. Each played a distinct role in the quarter’s overall performance.
| Segment | Q1 2025 Revenue (RM’ Mil) | Q1 2024 Revenue (RM’ Mil) | Revenue Variance (%) | Q1 2025 PBT (RM’ Mil) | Q1 2024 PBT (RM’ Mil) | PBT Variance (%) |
|---|---|---|---|---|---|---|
| Retail | 4,716.0 | 5,051.1 | (7) | 191.5 | 197.5 | (3) |
| Commercial | 4,312.7 | 4,277.0 | 1 | 178.3 | 118.9 | 50 |
| Convenience | 64.3 | 65.0 | (1) | 34.1 | 24.4 | 40 |
- Retail Segment: Revenue decreased by 7% due to an 11% reduction in sales volume, particularly for Diesel and Mogas. This was attributed to cautious consumer spending during the festive period. Despite higher average selling prices, PBT for the segment saw a marginal 3% decrease, offset by reduced expenditure.
- Commercial Segment: This segment was a standout performer, with revenue increasing by 1% driven by a 13% surge in sales volume, primarily from Jet A1 and Diesel. Although average selling prices were lower by 11%, PBT skyrocketed by 50% to RM178.3 million. This significant boost was thanks to higher gross profit for Diesel and Jet A1, fueled by a positive market environment, improved demand, and lower expenditure.
- Convenience Segment: Revenue remained comparable to Q1 2024, but PBT for this segment impressively grew by 40% to RM34.1 million, largely due to lower operational expenditure.
Financial Health Check: Balance Sheet & Cash Flow
PDB’s financial position remains robust, with a slight decrease in total assets and liabilities, and strong cash generation from operations.
As at 31 March 2025
Total Assets: RM10,930.4 million
Total Equity: RM5,923.2 million
Total Liabilities: RM5,007.3 million
Net Assets Per Share: RM5.86
As at 31 December 2024
Total Assets: RM11,115.7 million
Total Equity: RM6,069.2 million
Total Liabilities: RM5,046.5 million
Net Assets Per Share: RM6.01
Total assets decreased by 2% mainly due to a reduction in trade and other receivables, which was offset by higher cash and cash equivalents. Total liabilities also saw a 1% decrease, primarily from lower trade and other payables.
Cash Flow Q1 2025
Net Cash Generated from Operating Activities: RM2,084.1 million
Net Cash Used in Investing Activities: (RM22.1 million)
Net Cash Used in Financing Activities: (RM469.2 million)
Cash Flow Q1 2024
Net Cash Generated from Operating Activities: RM1,565.8 million
Net Cash Used in Investing Activities: (RM33.5 million)
Net Cash Used in Financing Activities: (RM284.0 million)
Operating cash flow saw a robust 33% increase, driven by lower purchase costs, though partially offset by a decrease in subsidy receivables. The higher cash used in financing activities reflects the increased dividend payments during the period.
Navigating Challenges and Charting the Future
PDB acknowledges the ongoing global uncertainties and potential inflationary pressures on its supply chain. However, the company maintains an optimistic outlook on the economic environment, expecting it to remain resilient. This resilience is anticipated to support PDB’s sustained growth, underpinned by steady consumer spending and robust investment activity within Malaysia.
To navigate these dynamics, PDB is focused on strengthening its fundamentals. The company plans to remain agile by streamlining its core strategies and executing effective cost optimization initiatives. Furthermore, PDB is committed to enhancing customer engagement and adopting a responsive approach to market shifts, aiming to sustain competitiveness in its core fuel and Convenience businesses. These efforts are crucial for advancing its long-term progress.
A notable development signaling PDB’s forward-looking strategy is the recent joint venture announcement on 9 May 2025. PDB, through its subsidiary PDB Growth Solutions Sdn. Bhd., entered into a strategic partnership with Blueshark Ecosystem Sdn. Bhd. to form Blueshark Malaysia Sdn. Bhd. This collaboration aims to advance the distribution and adoption of electric two-wheelers and related energy solutions in Malaysia, aligning with the country’s low-carbon mobility agenda. This move highlights PDB’s commitment to diversification and embracing future energy solutions.
Dividends: Rewarding Shareholders
In a positive move for shareholders, the Board has declared an interim dividend of 20 sen per ordinary share for the first quarter ended 31 March 2025, amounting to RM198.7 million. This is an increase from the 18 sen per ordinary share paid in Q1 2024. The dividend is payable on 21 June 2025 to depositors registered by 11 June 2025.
Summary and
Overall, PETRONAS Dagangan Berhad has delivered a robust performance in the first quarter of 2025. Despite a slight dip in revenue, the company demonstrated impressive profitability growth, driven by effective cost management and strong performance in its Commercial segment. The strategic focus on cost optimization, customer engagement, and a proactive approach to market shifts, including ventures into electric mobility, positions PDB for continued resilience and growth.
Key points from the report that stand out include:
- Significant increase in Profit Before Taxation (25%) and Net Profit (29%), showcasing strong operational efficiency.
- Exceptional performance from the Commercial segment, benefiting from increased demand for Jet A1 and Diesel.
- Healthy cash flow generation from operating activities, providing financial flexibility.
- A clear commitment to strategic growth and diversification, as evidenced by the Blueshark Malaysia Sdn. Bhd. joint venture.
- A higher interim dividend declaration, reflecting confidence in future earnings.
However, it is important to acknowledge the challenges mentioned, such as ongoing global uncertainties and their potential impact on inflationary pressures and consumer spending. PDB’s ability to navigate these external factors will be key to sustaining its positive momentum.
It’s important to remember that this analysis is based purely on the reported financial data and market outlook. Investors should conduct their own due diligence before making any investment decisions.
PDB’s Q1 2025 report paints a picture of a company adapting to market dynamics while maintaining a strong financial footing. The emphasis on operational efficiency and strategic diversification, such as the foray into electric two-wheelers, suggests a forward-thinking approach. Do you think PDB can maintain this growth momentum and successfully expand its reach into new energy solutions in the coming quarters? Share your thoughts in the comments below!
