KUALA LUMPUR (April 25): Petronas Dagangan Bhd (PetDag) has said it will continue to diversify its revenue streams by leveraging on its non-fuel offerings.

In a statement released in conjunction with its annual general meeting, PetDag said it operationalised seven new stations in the financial year ended Dec 31, 2021 (FY21) and upgraded close to 90% stations with state-of-the-art payment terminals and cloud-based point-of-sale system to enhance operational efficiency for a smoother customer experience.

The group recently incorporated Mesra Retail & Café Sdn Bhd to develop its own branded ready-to-eat, ready-to-drink offerings and expand its current food and beverage solutions.

It also sought to expand other Mesra-branded products as part of its non-fuel growth strategy.

PetDag's managing director and chief executive officer, Azrul Osman Rani, said the group was able to rebound swiftly from the pandemic largely owing to the strong foundation of its core businesses coupled with prudent cost and risk management.

"Our robust financial and operational standing has enabled us to pivot our businesses to thrive in the pandemic and the new normal that follows.

"We will continue to future-proof PetDag to prepare better against both anticipated and unexpected market forces by investing in digital solutions as well as diversifying our product portfolio and revenue streams," Azrul added.

In FY21, PetDag reinforced market leadership in the liquefied petroleum gas (LPG) business by expanding sales channels and venturing into the supply of 14kg cylinders for the forklift industry, tapping into the segment's growing potential, it said.

Meanwhile, its lubricant business recorded a 23% volume growth in its business-to-business (B2B) segment, contributed by the plantation, transportation and marine sectors.

In the business-to-consumer market, the lubricant segment leveraged on its own branded automotive workshop, Petronas AutoExpert and e-commerce platforms such as Lazada and Shopee.

"This has further strengthened brand affinity for its key products, Syntium and Sprinta. The business aims to widen its network of Petronas AutoExpert from 14 to 50 outlets by end-2022," the statement said.

Azrul also highlighted that PetDag is "inventing, incubating and scaling" disruptive ventures such as Setel (mobile app), ROVR (fuel delivery) and PRYSM (merchandise store) to become its next engines of growth.

According to the statement, Setel has introduced the first e-wallet sharing solution in Malaysia while also introducing a next-day intra-city parcel delivery service, Setel Express.

The latter registered 10 times' growth in volume with commitment to next-day intra-city delivery in three major areas, namely the Klang Valley, Johor and Penang, it said.

PetDag's mobile refuelling service ROVR expanded into Johor and Pahang with 58% volume growth. It also expanded into rural and B2B segments, via the launch of its first Mini Portable Container System in Kampung Limbawang, Beaufort, Sabah.

PetDag's branded merchandise PRYSM recorded a 62% increase in sales since being featured in the Setel app, which increased website traffic from 60,000 in 2020 to one million in 2021,the statement said.

"With this success, PetDag will start to offer other products on the Setel app [for examples,] lubricants, LPG to deliver a seamless online to offline experience for its customers," the statement noted.

On sustainability, PetDag said it is diversifying into lower-carbon-energy solutions towards sustainable growth including LNG and sustainable aviation fuel (SAF).

The group is working with Malaysia Aviation Group to encourage the adoption of SAF at Kuala Lumpur International Airport as a cleaner jet fuel alternative.

This is on top of its partnership with Mercedes-Benz Malaysia Sdn Bhd and EV Connection Sdn Bhd to instal its own branded fast electric-vehicle charger, Energise by Petronas, at five stations along major highways in 2022.

PetDag has also begun the development of local entrepreneurs, adoption of sustainable energy within its operations, and increasing the procurement of more environmentally friendly packaging materials for its products as part of its sustainability efforts, the statement said.

While still some ways from pre-pandemic levels, PetDag's performance rebounded in FY21 with net profit up 91.96% to RM529.75 million from RM2756.96 million in FY20. Revenue rose 20.28% to RM22.51 billion from RM18.71 billion in FY20.

A total dividend of 70 sen per share, representing a 102% payout ratio, was declared for FY21, the statement read.

PetDag shares closed 84 sen or 3.8% lower at RM21.08 on Monday, giving it a market capitalisation of RM20.94 billion.