Petaling Jaya, 13th February 2025 – DIALOG Group Berhad (DIALOG‐7277), a leading integrated technical services provider for the oil, gas, and petrochemical industry, today announced its financial results for the second quarter of the financial year 2025 ending 31st December 2024.
As part of its strategic realignment, DIALOG is prioritizing its profitable core business to drive long-term growth and resilience. In response to challenges in the petrochemical and renewable markets, the Group has impaired its investments in these areas to streamline operations for a more focused and sustainable path forward.
For the quarter ended 31st December 2024, DIALOG recorded revenue of RM680.0 million and a loss after tax of RM125.6 million. The loss was mainly due to one-off impairments of its petrochemical and renewable investments as the Group prioritizes its focus on core business.
In 2023, DIALOG took the decision to invest in a downstream specialty chemical plant producing Malic Acid in Kuantan. Since then, the price of malic acid across Southeast Asia has declined by 20-30%, primarily due to oversupply. In addition, the continued volatility and challenging global chemicals market, and the uncertain macro-economic environment, has led the Group to make the strategic decision to discontinue this project.
Additionally, the Group fully impaired its investment in a joint venture company that is involved in the production of food grade recycled polyethylene terephthalate pellets (“rPET”). The decision was made mainly due to the delayed commitment by the brand owners to increase their recycled content resulting in persistent soft demand for food grade rPET.
Despite these challenges, DIALOG remains cash-generative, generating RM409 million in net operating cash flow year-to-date, with an unrestricted cash balance of RM1.39 billion as of 31st December 2024.
Looking ahead, DIALOG continues to prioritize its core businesses in Upstream, Midstream and Downstream.
As part of its Upstream expansion, DIALOG has commenced development of the Baram Junior Cluster Small Field Asset Production Sharing Contract following its final investment decision while studies for the Raja Cluster Small Field Asset Production Sharing Contract, awarded in December 2024, are currently underway.
Midstream remains a core focus, with phased capacity expansions in Pengerang Deepwater Terminals (“PDT”), solidifying its position as a leading petroleum and petrochemical hub in Asia Pacific. Within PDT, DIALOG and PETRONAS Gas Berhad have in January 2025 announced a joint investment into a Liquefied Natural Gas-driven Air Separation Unit facility.
In the Downstream business, DIALOG remains cautious with an emphasis on prioritizing in-house projects. Meanwhile, its associate, Morimatsu Dialog (Malaysia) Sdn Bhd, is investing RM250 million to expand its fabrication facilities in Pengerang, Johor to meet the demands and opportunities of specialised process modules and skids in the region and beyond.
Recognising the growing demand for low-carbon fuel alternatives, DIALOG has also invested in renewable fuel storage facilities at its DIALOG Terminals Langsat (3). Phase 1 will be operational with the first shipment expected this month. Phase 2 will be completed in September 2026.
These strategic decisions are focused on building a stronger, sustainable business. With challenges in the petrochemical and renewables market, impairment of these investments allows streamlining of operations to prioritize core activities in Upstream, Midstream and Downstream business, positioning DIALOG for stronger performance and greater resilience ahead.
Barring any unforeseen circumstances, the Group is optimistic about delivering a positive performance for the financial year ending 30th June 2025.