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Global petchem companies report strong financial results for Q4

by Başak Ceylan -
  • 03/02/2021 (03:55)
Global oil and petrochemical companies started to announce their financial results for the three-month period ending on December 31, 2020. The latest financial results showed that most companies performed well in the final quarter and in all 2020 despite the crisis brought on by the coronavirus pandemic.

SABIC, a subsidiary of the state-owned Saudi Aramco, announced that its revenue for the fourth quarter reached SAR32.8 billion ($8.76 billion), compared with SAR29.3 billion ($7.81 billion) in the previous quarter. The company’s quarterly net profit of SAR2.22 billion ($592 million) also showed a 104% increase quarter-over-quarter amid higher sales volume and lower average cost of sales.

“The fourth quarter benefited from sustained economic recovery, which translated into higher demand for our products,” Yousef Al-Benyan, SABIC Vice Chairman and CEO, said.

However, SABIC’s annual profits of SAR40 million ($10.67 million) represented a slump of 99%, largely due to impairment provisions in certain capital and financial assets.

Multinational chemical giant LyondellBasell’s net income for the fourth quarter of 2020 stood at $855 million, compared with $114 million reported in the previous quarter.

The quarterly profit was also higher than the year-ago period by around 40%. At the same time, the company reported the highest fourth quarter EBITDA since 2017 at $1.4 billion.

“The trajectory supports our belief that pandemic driven reductions in demand for our products bottomed during the second quarter,” said Bob Patel, LyondellBasell CEO.

The full year net income, on the other hand, was $1.42 billion, compared with $3.39 billion reported in 2019. “Considering the severe decline in economic activity during the past year, LyondellBasell’s results proved to be relatively resilient,” LyondellBasell CEO added during the conference call.

The US-based Dow Chemical reported net income of $1.24 billion, compared with a $2.32 billion loss in the same quarter last year. The company’s net sales were at $10.7 billion, up 5% from the year-ago period and 12% from the previous quarter.

The company’s packaging and specialty plastics business reported net sales of $5.1 billion. “Sales were up year over year, primarily driven by steady volumes and improved polyethylene pricing, particularly in food and specialty packaging as well as health and hygiene applications,” said Jim Fitterling, Dow Chemical CEO.

LG Chem, the largest Korean chemical company, announced quarterly revenue of KRW8.85 trillion ($7.9 billion), indicating an 18.4% increase compared to previous quarter and also a 19.9% increase compared to previous year. The company also highlighted that this was the highest-ever quarterly revenue.

The full year revenue was KRW30 trillion ($26.8 billion), up 9.9% from the previous year. The company’s annual operating profits were at KRW2.35 trillion ($2.1 billion), indicating an increase of 185.1% compared to previous year.

Petrochemicals business’ net profit for the quarter was KRW569 billion ($509 million), up from KRW316 billion ($283 million) reported last year. At the same time, the company’s 2021 business forecast for petrochemicals showed “concerns over increased supply due to newly expanded supplies in Northeast Asia”. However, petrochemicals demand is also forecast to improve gradually amid the expected global economic recovery.
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