Third quarter yields mixed results for Saudi petchem companies
SABIC, the largest capitalized company on the Saudi bourse, announced a net profit of SAR1.09 billion ($290 million). This was higher than the net loss of SAR2.22 billion ($590 million) in the previous quarter and the net profit of SAR740 million ($200 million) in the third quarter of 2019.
The increase was attributed to higher sales volumes and product prices, which resulted from an improvement in economic activity and an increase in oil prices.
On a quarter-on-quarter basis, Yanbu National Petrochemical’s (Yansab) net profit quadrupled to SAR195.6 million ($52.1 million). However, yearly comparison showed a decline of around 7.7% in net profit. This was primarily driven by lower average sale prices of their products when compared to the third quarter of 2019.
Saudi Kayan swung to a net loss of SAR28.2 million ($7.5 million) versus a net profit of SAR1.26 million ($0.33 million) reported in the same period of 2019. However, the company narrowed its net loss by 93% from the SAR336.6 million net loss reported in the second quarter. The company attributed this to an increase in average sale prices and volumes during the third quarter.
Sahara International Petrochemical (Sipchem) reported a net profit of SAR10 million ($2.7 million), up from a net loss of SAR99 million ($26.3 million) in the previous quarter. Higher selling prices for methanol and polymers, as well as higher sales volumes of polypropylene (PP), acetic acid and vinyl acetate monomer (VAM) were cited as key factors for the increase. However, a significant reduction in netbacks for most of Sipchem’s products, and lower sales volumes of methanol, butanediol and ethyl vinyl acrylate resulted in a decrease of more than %90 on a yearly basis.
Advanced Petrochemical Company’s net profit in the third quarter of 2020 declined by nearly 27% from the same quarter of last year to SAR156 million ($41.6 million). At the same time, the company’s profit was marginally higher than SAR154.9 million ($41.3 million) reported during the previous quarter. The slight increase came despite 2.9% lower PP sales volume and 20.6% higher outsourced propylene prices. The average sales price for PP was higher by 8.1% from the previous quarter while the yearly comparison showed a decline of 12.5%.
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