Saudi petchem producers announce financial results for Q3
SABIC’s net profit fell 6.8% on the year to 5.22 billion riyals ($1.39 billion) in the July-September period compared with a net profit of 5.60 billion riyals ($1.49 billion) in the same period of last year. However, the company’s Q3 net profit exceeded analysts’ expectations which called for a 5.05 billion riyals net profit. This suggested the eighth consecutive quarter of decline, according to Reuters’ data.
The major producer’s weaker financial results for the quarter was led by lower sales prices and volumes which erased the benefits of weaker feedstock costs. Moreover, the producer’s financial standing remained negatively affected by lower crude oil prices and weak global economy. The company’s sales in the three months ended September 30 were reported at 33.31 billion riyals ($8.88 billion), down 10.8% from 37.35 billion riyals in the corresponding period of 2015.
However, Saudi Kayan Petrochemical Co, an affiliate of SABIC, posted a net profit of 156.32 million riyals ($41.7 million) in the third quarter compared with a loss of 13.81 million riyals in the same period of 2015.
Saudi Arabia’s Yanbu National Petrochemical Co (Yansab), a subsidiary of Saudi Basic Industries Corp (SABIC) also increased its net profit by more than twofold in the July-September period. The company’s net profit for the quarter was reported at 607.6 million riyals ($162.1 million), up from 301.7 million riyals in the same period of last year. However, the company’s Q3 net profit fell below analysts’ expectations of a 624.7 million riyals net profit in a survey by Reuters.
Saudi Arabia’s National Industrialization Co (Tasnee) also extended its gains to the third quarter, making a profit of 122.2 million riyals ($32.6 million) in the third quarter of this year. The company’s Q3 net profit was supported by lower feedstock costs and stronger sales which offset the effects of lower product prices. Before posting gains in the second quarter, the company had witnessed losses in every quarter in 2015 as well as the first quarter of this year. The company also reportedly took some measures for reducing costs like laying off more than 25% of its employees.
Market sources reported that Saudi Arabia’s Sahara Petrochemicals Company reported their financial results for the third quarter of 2016. Sahara’s net profit declined 13% from a year earlier to 105.3 million riyals ($28 million) in the July-September period due to decreasing sales and rising expenses. The company’s sales also decreased 16% in the third quarter.
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