National oil firm Petronas said today its full year net revenue surged 21 percent from the year before to a record high, buoyed by high oil prices and strong sales.

Net revenue in the year to March hit RM81.43 billion, the "highest in Petronas' 29 years of existence," chairman Azizan Zainul Abidin told a news conference.

However, net profit increased at a slower pace of about four percent to RM15.11 billion, Azizan said.

Petroliam Nasional Bhd's (Petronas) return on revenue remained among the highest in the industry at 33 percent, compared to a below 10 percent average for other global oil and gas companies.

Higher price per barrel

Its financial performance has put it on par with international players, most of whom are larger in size and scale of operation, he added.

President and chief executive Hassan Marican said net profit did not grow proportionately with sales due to lower contribution from unit Malaysia International Shipping Corp and a stronger rand.

The company's return on total assets also fell to 15 percent, down from 16.86 percent a year earlier.

However Hassan said Petronas' balance sheet has strengthened, with total assets expanding 23 percent to 178 billion ringgit and shareholders funds rising 21 percent to RM78.36 billion.

Its cash and fund investments also rose 29 percent to RM55.36 billion.

Hassan said the average price of Malaysian crude surged to US$28.60 a barrel during the year, from US$23.24 in 2002.

Gross sales from crude oil rose to 378.8 million barrels, up from 339.5 million a year earlier, pushing sales revenue up by 32 percent to RM19.18 billion.

Switching to Euro

Hassan said Petronas has operations in 34 countries, which contributed 31 percent to group sales.

"The last financial year was not a very easy year... we continue to look at opportunities but only in focus regions," he said, citing Southeast Asia and Africa.

He said group borrowings grew 44 percent to RM58.09 billion as a result of raising US$3.65 billion in the international bond market, the largest ever by an Asian corporation.

Of the total debts, about 52 percent are due in less than five years and 72 percent pegged in US dollar, 11 percent in ringgit and the balance in yen and rand.

Petronas, heeding a call from Prime Minister Dr Mahathir Mohamad to switch to the euro, has begun diversifying its currency portfolio but Hassan admitted the process was tough.

"It is not easy to move away from the US dollar because the oil trade is conducted in the dollar but we are diversifying to the euro," he said.

Petronas's exports accounted for about 45 percent of group revenue and make-up about 10 percent of Malaysia's total exports.

Net oil importer

Despite higher production, Hassan said Malaysia was expected to become a net oil importer by end of the decade as demand grew in tandem with the country's development.

On the company's capital expenditure for the current year, he said Petronas "normally set aside three billion ringgit a year."

As at January, Petronas has total oil and gas reserves of 24.14 billion barrels of oil equivalent, of which 80 percent are from domestic and the balance from its international ventures. - AFP