By Ying Xian Wong
Lotte Chemical Titan Holding shares fell Friday morning after the company’s losses widened in the second quarter due to weaker demand.
Shares in the Malaysia-listed chemical company slid as much as 8% and were recently 7.2% lower at 1.16 ringgit, bringing 12-month losses to 36%.
Lotte Chemical Titan late Thursday posted a net loss of MYR313.5 million ($69.3 million) for its second quarter, compared with a net loss of MYR145.9 million a year earlier. The result was mainly due to a further decline in chemical product spreads amid weaker demand, as well as higher operating costs.
Quarterly revenue fell 34% to MYR1.86 billion.
TA Securities analysts said in a note that they have cut their 2023-2025 earnings forecasts for the company, citing a challenging near-term outlook. They also lowered Lotte’s target price to MYR0.86 from MYR0.93, and kept a sell rating on the stock.
TA analyst Ong Tze Hern said that given the weak global economic environment, product spreads may stay stagnant, which, coupled with China’s sluggish reopening, could mean that Lotte’s losses will persist in the second half.
Write to Ying Xian Wong at [email protected]
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