Saudi Arabia’s SABIC, a global leader in diversified chemicals, announced on Wednesday its financial results for the year 2024, with a net profit of SAR 1.5 billion compared to a net loss of SAR 2.8 billion in 2023.
However, the petrochemicals giant recorded an unexpected loss of 1.89 billion riyals ($503.9 million) in the fourth quarter of last year, weighed down by rising fixed costs.
Eng. Abdulrahman Al-Fageeh, SABIC CEO, attributed the increase to higher oil product prices during winter and warned that challenges in the petrochemicals sector were likely to persist throughout 2025.
SABIC, 70% owned by Saudi Aramco, disclosed to the Saudi Stock Exchange (Tadawul) three key factors that contributed to its return to profitability in 2024.
The company said it recorded a SAR 3.52 billion reduction in total losses from discontinued operations, driven by the fair value assessment of Saudi Iron and Steel Co. (Hadeed) and operational losses at Hadeed.
Operating profit also rose by SAR 2.02 billion due to higher gross profit, though partially offset by increased operating costs. Additionally, zakat expenses fell by SAR 1.06 billion, primarily due to the reversal of a zakat provision for 2024.
SABIC reported a 1% decline in annual revenue, reaching SAR 140 billion, while sales volumes dropped 2% to 45.1 million metric tons from 45.9 million metric tons in 2023. However, the average selling price rose by 1%.
Al-Fageeh attributed the company’s fourth-quarter losses to higher fixed costs, which typically increase in winter due to rising oil product prices.
Speaking at a press conference to review the company's financial results, he forecast stable demand for end-products in the first quarter of 2025, compared to the last three months of 2024.
He also revealed that the proceeds from the sale of SABIC’s stake in Bahrain’s Alba to Saudi Arabian Mining Company (Maaden), valued at SAR 3.6 billion ($960 million), would be used to boost its petrochemicals investments and diversify its portfolio.
Al-Fageeh highlighted SABIC’s continued growth, stressing that the company is moving in the right direction as planned.
He outlined its expansion projects that include the Fujian Petrochemical Complex project in China, which will become operational in the second half of 2026.
SABIC previously forecast that the financial impact of the project would be reflected in the company’s results after its completion and the start of commercial operations in the first half of 2027.
SABIC expects capital expenditures between $3.5 billion and $4 billion this year, compared to previous guidance of $4 billion to $5 billion for 2024.
