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Saudi Basic Industries Corp (SABIC), one of the biggest petrochemical companies globally, said on Thursday its Q2 net profit plummeted 85% on weak demand and lower average sales prices.
The company posted a net profit of 1.18 billion riyals ($315 million) in the quarter ended June 30, compared with SAR7.93 billion in the year-earlier period.
The net profit beat analysts’ mean estimate of SAR 1.05 billion, according to data compiler Refinitiv.
Sales revenue was SAR37.17 billion, down 34% year-on-year.
For H1, SABIC reported profit of SAR1.84 billion, 87% lower versus SAR14.40 billion in Q2 2022.
"The global economy is continuously slowing down as a result of tightening monetary policies to confront inflation, leading to weaker demand and a decrease in the average selling prices of the company's products as well as lower quantities sold," the petchems giant said in regulatory filing on Riyadh's Tadawul exchange.
The lower weaker sales revenue was only partly offset by lower feedstock prices, it said.
SABIC said it would maintain stable dividends. In June 2023, it approved a cash dividend distribution of SAR 1.80 per share for the H1 2023.
The company said it expects to maintain capital expenditure at $3.3 to $3.8 billion this year.
The company’s share price was little changed at SAR 85.5 at 11:30 AM GST
(Reporting by Brinda Darasha; editing by Seban Scaria)
