Saudi Basic Industries Corp (SABIC), one of the world’s largest petrochemical firms, returned to profit in the third quarter, recovering from a loss a year earlier, helped by higher revenue and core earnings.
SABIC, 70% owned by Aramco, reported a net profit of SAR 1 billion ($266 million) for the three months ending September 30, according to a disclosure to the Saudi Stock Exchange (Tadawul).
This is a major improvement from a loss of SAR 2.87 billion during the same period last year.
SABIC CEO Abdulrahman Al-Fageeh said: “The increase in the third quarter’s profits compared to the same quarter last year is attributable to higher average selling prices of some key products, and a decrease in total losses on non-continuing operations.”
Analysts had projected that SABIC would achieve profits of up to SAR 1.7 billion.
SABIC attributed its growth mainly to higher average selling prices, which were partially offset by a slight decline in sales volumes.
The company’s net profit was primarily driven by an increase in operating income of about SAR 797 million, thanks to improved profit margins despite higher operating costs. Gains also came from selling its specialized business that produces plastic sheets and films, along with foreign exchange benefits in the third quarter of 2024.
Profit was also driven by a decrease in losses from discontinued operations by around SAR 3.3 billion, mainly due to the fair value assessment of Saudi Iron and Steel Company (Hadeed), classified as a discontinued operation while awaiting the closure of a previously announced sale.
This was partly offset by a drop in financing income of SAR 390 million from the revaluation of equity derivatives, which are non-cash items.
