“Advanced” profit growth of 5.3% in Q3-2019

“Advanced” profit growth of 5.3% in Q3-2019
Advanced profit growth of 5.3% in Q3-2019

Advanced Petrochemical Company's "Advanced"profits increased by 5.3% to SAR213mn in Q3-2019, compared to SAR202.2mn in Q3-2018.This is due to the low prices of propane and propylene purchased from externalsources.

Profit for the nine-month period rose 2.5% to SAR576mn, compared toSAR553mn in the same period last year.

Net profit increased by 5.3% compared to Q3-2018, mainly due tolower prices of propane and propylene purchased from external sources by 41%and 15.6% respectively, and a decrease in consumption of propylene purchasedfrom outside sources by 24.3%.

Despite the decrease in the prices of polypropylene by 13.8%, theincrease in propane consumption by 11.9%, and the increase in general andadministrative expenses by 47.7%, the net profit improved by 2.5% during the nine-monthsperiod, due to an increase in sales volume by 9.3%, and the decrease in propaneand propylene prices purchased from external sources increased by 23.4% and16.1%, respectively, despite a 9.5% decrease in polypropylene prices, a rise inconsumption of propane and propylene purchased from outside sources by 7.7% and4.0%, respectively, higher fixed production costs, overheads, and administrativeexpenses by 31.6% and 41.8% respectively, and a declining share of profits frominvestment in SK Advanced Co., Ltd.

Also, the net profit for the Q3-2019 includes SAR25.8mn which is adividend from investment in SK Advanced Co., Ltd. in South Korea compared to SAR25.4mnfor the Q3-2018 and SAR3.1mn for the previous quarter.

Earnings per share have been adjusted for the same period of theprevious year due to the increase in the number of shares due to the issuanceof bonus shares by 10% upon the approval of the General Assembly on 17September 2019.

As of 1 January 2019, the Company has adopted IFRS 16 for leaseswith no material impact on the interim financial statements.

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