Borouge’s Q2 profit exceeds expectations

UAE’s Borouge’s net profit for the second quarter of 2024 was up by 33% year-on-year to be reported at $308 million, beating expectations. The company attributed the yearly increase to higher sales and cost efficiencies. The company’s Q2 net profit was also up on a quarterly basis by 13%.

The company’s adjusted EBITDA was $613 million in the second quarter, up by 18% from $518 million in the same period of last year and 8% from $567 million in the first quarter of this year, supported by increased revenue and improved cost per ton.

Borouge reported a net revenue of $1.5 billion, up by 6% when compared to the same period of last year and 15% from the first quarter of this year. This also exceeded economists’ expectations. Moreover, the company’s sales volume increased by 16% q-o-q and 9% y-o-y during the same period.

Indeed, the company recorded its highest ever production volumes during the period. The company reported high utilization rates of 114% for polyethylene and 103% for polypropylene, underpinned by an ongoing focus on process safety and asset reliability.

In the UAE, the Borouge 4 facility mega project is over 70% complete. This will increase production capacity by 28%, making Al Ruwais Industrial City the largest integrated single-site polyolefin complex globally. The project, built by Borouge for ADNOC and Borealis, is on track to finish by the end of 2025, potentially adding $1.5 to $1.9 billion in annual revenue. Upon completion, it will be transferred to Borouge from ADNOC and Borealis.

Borouge is also progressing with plans to increase the capacity of its second ethylene unit (EU2), aiming to boost the production of olefins and polyolefins by an additional 230,000 tons. Scheduled for completion in 2028, this increased capacity is expected to contribute $220 - $250 million in annual revenue.