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29/01/2018 - 15:37hs

Saudi petrochemical company increases profit

Sabic increased its profit by 4.5% in 2017, but with a 18.6% decline in the year’s Q4. The drop occurred at the end of the year, mainly due to maintenance stoppages in the plants.

São Paulo – Saudi Basic Industries Corp (SABIC), a Saudi company that is one of the world’s largest petrochemicals, announced a raise in its net profit of last year, despite a decline in the last quarter. The company’s results were released in a press conference by the company’s executives this Sunday (28) in Riyadh.


SABIC executives talking with the press

Last year’s net profit reached SAR 18.4 billion, or USD 4.8 billion in the current exchange rate, up 4.5% over the previous year. Gross profit reached SAR 50.29 billion (USD 13.3 billion), an increase of 6.46% over 2016. Earnings per share was of SAR 6.13 (USD 1.63).

According to information by SABIC’s vice-president and CEO, Yousef Al-Benyan, the rise in profits was due to positive results of the implementation of a transformation program in the company. He highlighted the incentives by the local government to the private sector as also a boost to Sabic’s performance.

In Q4, however, the company’s results were not that good. Net profit totaled SAR 3.6 billion (USD 977 million), with a decline of 18.6% over Q4 2016, and of 36.6% over 2017’s Q3. Gross profit totaled SAR 12.6 billion (USD 3.3 billion) and increase of 13.7% over the same period of 2016, but declined 10.2% over the three previous months.

The SABIC’s CEO attributed the decline in profits at the end of last year to a decrease in output volumes due to maintenance stoppages in some of the company’s plants, which were held with the aim to increase future reliability of these plants. Also with an impact on results was the slowdown in the construction sector. The sector uses some of the petrochemicals products, such as PVC.

Despite this, Al-Benyan said that the company holds positive expectations on the global economy in 2018, with a growth in the American and European markets, plus a stability in China. SABIC also is expecting an improvement in the Saudi construction sector in 2018, due to an expectation that public investments will increase.

Last week, SABIC acquired 25% of equity shares of the Swiss multinational group from the chemical sector Clariant. According to a news feature published at the Gulf Business’s website, the company reported that it doesn’t have plans for a total acquisition of Clariant.

*Translated by Sérgio Kakitani

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