(EnergyAsia, Feb 28) — Malaysia’s Shell Refining Company Berhad has announced a record net income of RM188 million for the fourth and final quarter of 2004, ending the year with a fourth consecutive quarter of record profitability. (US$1=RM3.8). The company said its cumulative net income for 2004 came to an annual record of RM670 million, representing an increase of RM488 million or 268% above the 2003 net income level of RM 182 million, the previous record.

The fourth quarter earnings include an after-tax stockholding loss of RM 48 million partially offset by a RM 11 million accounting adjustment relating to the capitalisation of certain costs. This result for the quarter represents a very significant increase in profits when compared to the net profit after tax of RM59 million recorded in the same quarter of 2003.

Jon Chadwick, chairman of Shell Refining, said: “These results represent an impressive performance. We are pleased to deliver these earnings, improving profitability levels continuously throughout the year – for the fourth consecutive quarter, we have delivered record profitability despite a significant stockholding loss during the quarter. This financial performance was mainly due to the combined strengths of our refining margins and continued strong operational performance.”

In view of the exceptional fourth quarter financial results, the Shell board recommended a final dividend of 35 sen per share, giving a total dividend level for 2004 of 65 sen per share. This includes an interim dividend of 10 sen per share and two special dividends each of 10 sen per share previously paid.

Shell Refining said its recommended 2004 dividend represents an increase of 160% compared to the total dividend of 25 sen per share paid in respect of 2003. This final dividend for 2004 was declared during the company’s February 23 board meeting and will be subject to approval at the company’s forthcoming annual general meeting.

Mr Chadwick added: “Our shareholders will receive a record annual dividend, reflecting the quality of the full year financial results. The highest annual dividend level we have ever paid before was 37 sen per share. 2004 dividend payment performance is linked to the company’s significant cash generation throughout the year.

“It is the board’s intention to sustain for the foreseeable future an annual dividend level of at least 45 sen per share, i.e. at least at the level of the combined interim and final 2004 dividend payments.”

Last year, the company benefited from an net stockholding gain of RM80 million (2003: net stockholding gain of RM 12 million) due to the overall oil price increase in 2004, accounting for 12% of the company’s total net profit after tax.

Shell’s refinery processed 10.55 million barrels of crude oil and feedstock and sold 10.88 million barrels of products during the quarter.