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Shareholders approve $650 million final 2023 cash dividend, taking year’s total to $1.3 billion
Company intends to pay a $1.3 billion dividend in 2024, underpinned by exceptional cash generation and healthy balance sheet
Borouge 4 mega project, set to boost Borouge’s production capacity by 1.4 million tonnes per year and its revenue by $1.5 - $1.9 billion, is 60% complete
Borouge actively pursuing accelerated global growth prospects, including a significant opportunity in the Asia Pacific region that has reached feasibility stage
Company announces strategic project to expand its second ethylene unit, which will boost its olefins and polyolefins production by 230,000 tonnes by 2028
Borouge pursuing several AI and advanced technology projects, aiming to generate further $280 million
Abu Dhabi, United Arab Emirates: Borouge Plc, a leading petrochemicals company that provides innovative and differentiated polyolefins solutions, confirmed shareholder approval of a $650 million (7.94 fils/share) final 2023 cash dividend at its Annual General Meeting (AGM). The company also confirmed its intention to pay a total dividend of $1.3 billion for 2024, reinforcing its commitment to shareholder value and demonstrating its confidence and ability in generating earnings and profits even in the face of challenging market conditions.
H.E. Dr. Sultan Al Jaber, Chairman of Borouge, said: “In 2023, Borouge significantly outperformed its industry peers, demonstrating remarkable operational and financial resilience and reinforcing its position as one of the world’s most profitable and innovative polyolefin producers. Borouge is pursuing accelerated growth domestically and internationally. Locally, Borouge 4, a major strategic growth project, is expected to add approximately $1.5 - $1.9 billion to revenue annually after recontribution and full production ramp-up of the plant. Borouge 4 will boost the company’s production capacity by 28%, making Borouge’s Al Ruwais production site the world’s largest integrated single-site polyolefin complex. I am also pleased to announce a new expansion project. Our second ethylene unit (EU2) is advancing plans to increase our total production of olefins and polyolefins by 230,000 tonne after project completion in 2028, and is expected to contribute approximately $ 220 to 250 million to Borouge’s revenue per year. Internationally, the company is pursuing accelerated global growth opportunities, including an opportunity in the Asia Pacific region that has reached feasibility stage. I am confident that Borouge will continue to deliver unparalleled performance and growth in 2024 and beyond, supported by its robust business model and focus on innovation and AI technology.”
Hazeem Sultan Al Suwaidi, Chief Executive Officer of Borouge, commented: “The significant $1.3 billion dividend from our 2023 earnings reflects the success of our business strategy and our operational resilience in a challenging market environment. Our outstanding operational and commercial excellence yielded exceptional performance compared with our global peers. This was supported by a highly effective Value Enhancement Programme, which enabled us to successfully optimise revenues and streamline costs amid softening prices globally. We will explore in parallel further levers to enhance our competitive cost position. Once operational, Borouge 4 will significantly increase our capacity by 28% while enhancing our product portfolio and margin. Our focus remains on sustainable growth and delivering value, with our shareholders set to profit from exceptional recurring dividends in the years to come.”
Strong 2023 financial performance
Borouge successfully navigated the bottom of the cycle and delivered a significant $1.0 billion in net profit in 2023. Borouge’s $607 million Value Enhance Programme contributed a significant 28% to 2023 EBITDA, the highest total impact in any single year of any announced programmes by peers. The company achieved record sales volumes of 5.1 million tonnes, driven by exceptional production and industry-leading asset utilisation rates, adding approximately 200,000 tonnes in polyolefins sales which contributed $106 million EBITDA in 2023.
As a result of these initiatives, Borouge outperformed its regional and international peers with one of the highest EBITDA margins in the industry at 38%. By continuing to actively manage costs and adapt to evolving market dynamics, Borouge expects to sustain these substantial efficiencies and value.
Maintaining momentum: $1.3 billion dividend in 2024
Borouge will distribute a total of $1.3 billion in dividends for 2023, following AGM approval of final dividend of $650 million, equivalent to 7.94 fils (AED0.0794) per share, representing a 6.4% dividend yield based on the latest share price[1]. Looking ahead, Borouge intends to pay a $1.3 billion cash dividend for the full year 2024, equivalent to 15.88 fils (AED0.1588) per share. With exceptional cash generation and extremely strong cash conversion and a very healthy balance sheet of more than $3.97 billion in retained earnings at the end 2023, Borouge shareholders can expect a secure and very substantial dividend.
Driving operational excellence and innovation with digitalisation and AI
Digitalisation and artificial intelligence (AI) are integral drivers of innovation, efficiency, and value creation across Borouge's operations, facilitating operational excellence and catalysing the development of cutting-edge solutions. Borouge has embarked on several AI and advanced technology initiatives, which delivered $58 million in value to date in 2023. The company targets several significant milestones that would enable the realisation of around $280 million in value generation in the coming years. Its Innovation Centre facilitated the introduction of eight groundbreaking products in 2023, including a pioneering solution for gas pipes that is now globally recognised for its unrivalled safety and reliability standards.
Innovation solutions for the world’s challenges
Borouge’s innovative solutions cater to a variety of sectors, including energy, infrastructure, and healthcare, where the demand for versatile and resilient materials is ever-increasing. These solutions are also at the forefront of tackling critical global challenges including energy transition, water access and food scarcity.
Looking ahead
Borouge is committed to expanding its leading financial position and stability, ensuring long-term profitability. Borouge’s strategic financial management and operational excellence position it for strong cash and net profit generation, as well as very significant dividend payments throughout the cycle. This strong foundation supports the company’s continued successful growth execution.
At the same time, Borouge is actively expanding its use of AI to enhance agility across its operations, which have already demonstrated very tangible success and enabled substantial efficiency gains. This strategic move not only drives cost savings and operational efficiencies but also underpins the company’s approach of continuous improvement and innovation. By seamlessly integrating AI, Borouge demonstrates its proactive commitment to remaining at the forefront of technological progress, thereby enhancing global competitiveness.
About Borouge
Borouge Plc, listed on the Abu Dhabi Securities Exchange (ADX symbol: BOROUGE / ISIN AEE01072B225), is a leading petrochemicals company that provides innovative and differentiated polyolefin solutions for the infrastructure, energy, mobility, healthcare, agriculture and advanced packaging industries. Borouge employs more than 3,100 people and serves customers in over 86 countries across Asia, the Middle East and Africa.
Founded in 1998 through a strategic partnership between ADNOC and Borealis, Borouge was formed to build and operate a polyolefins complex in Al Ruwais Industrial City, United Arab Emirates, which today is one of the world’s largest integrated polyolefin complexes. ADNOC owns a majority 54% stake and Borealis holds a 36% stake in Borouge.
To find out more, visit: borouge.com
For further information, please contact:
Rehab Omar Ateeq
VP, Global Communications
Media@borouge.com
Samar Khan
VP, Investor Relations
IR@borouge.com