(MENAFN- The Peninsula) Industries Qatar (IQ), one of the region's industrial giants with interests in the production of a wide range of petrochemical, fertiliser and steel products delivered a net profit of QR2.4bn for the first half of 2015 (H1, 15).
The group recorded commendable financial results across all segments during the second quarter following the strong recovery in petrochemical product prices and improved sales volumes across all segments. The group also reported a strong year-on-year sales growth of 17.1 percent as most of the group's production facilities were on extensive planned and warranty maintenance shutdown during the first half of 2014.
IQ's reported revenue for the period ended June 30, 2015 was QR 2.9bn, a modest decrease of 8.1 percent, over the first half of the previous year. However, on a like-for-like basis, management reporting revenue was QR 8.2bn, a decrease of 4.8 percent, versus the same period of 2014.
Reported revenue for the second quarter was QR 1.6bn, significantly up by 20.1 percent on the last quarter, while management reporting revenue, assuming proportionate consolidation, was significantly up by more than 16 percent. The quarter-on-quarter revenue improvement was primarily driven by the improved product prices, notably in the petrochemical segment and improved sales volumes in the petrochemical and steel segments.
This year-on-year reduction in revenue was primarily driven by a significant reduction in petrochemical product's selling prices following the oil price decline that began in early Q4, 2014 and moderate reduction in the fertiliser product prices driven by favorable market conditions primarily for some of the key supplier markets. Sales volumes nevertheless were significantly up on last year as the group benefited by comparatively lower number of planned maintenance days in the current year since most of the group's production facilities completed their planned and warranty maintenance shutdown in 2014 resulting in a significantly higher maintenance days in the first half of 2014.
The QR2.4bn net profit delivered for the period under review reflects a reduction of 14.6 percent, against the same period of 2014. This reduction in net profit was primarily driven by the reduced revenues resulting from the petrochemical product price deflation following the significant fall in global oil prices that started to impact group's products in late 2014 and weaker fertiliser prices driven by favorable market conditions primarily for some of the key supplier markets.
Net profit for Q2, 2015 was QR 1.5bn, up QR 0.5bn or 54.9 percent on last quarter. This robust increase in the quarterly net profit was aided by the strong recovery in the product prices most notably in the petrochemical segment and improved sales volumes in the petrochemicals and steel segments.
As for the group's current projects, Qatar Steel has opted to sell its 50 percent stake in the joint venture Qatar Steel International to Qatar Mining Company, the other joint venture partner. Qatar Steel will, however, continue to be involved in the project by providing technical services and support.
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