Saudi Petchems Firms Report Higher First Half Income As Profits Track Oil Price Rise

18 Aug 2017 Issue: 60 / 33

Saudi state-led giant Sabic was hit by a second quarter loss in its steelmaking unit. Most firms report increased 1H income, though some were hit by outages.

So far 13 out of Saudi Arabia’s 14 stock exchange traded petrochemical firms have completed reporting second quarter earnings – later than normal, as with the first quarter, due to new accounting rules introduced at the end of 2016 (MEES, 12 May). One firm, Alujain whose end-H1 2017 market capitalization was among the smallest at SR1.5bn, said on 17 August that it was unable to publish results on time but would issue them when “review procedures have been completed.”

The largest amongst the Saudi petchems firms by far – the Sabic petrochemicals and steel conglomerate, which is owned 70% by the government and 30% by private investors – reported a first half improvement despite a second quarter decline. Half-yearly figures were boosted by stronger oil prices year-on-year – though both oil prices and profits were lower in Q2 than Q1 (see chart). (CONTINUED - 1187 WORDS)