In line with the decline in petrochemical prices, SABIC makes net profits of SAR2.12bn in the second quarter of 2019.
SABIC announced, on Sunday, its second quarter earnings for the second quarter of 2019, with net profit for the second quarter of SAR2.12bn compared to SAR6.7bn in the same quarter of 2018, a decrease of 68.35%.
Total sales in the second quarter were SAR35.87bn, down by 17.12% year-on-year and 4% lower than the previous quarter.
In a press conference on the company’s performance and its financial results, SABIC’s Vice-Chairman and CEO, Youssef bin Abdullah Al-Bunyan said that the slowdown in global GDP growth coincided with a decline in petrochemical prices due to the large increase in supply capacity, resulting in lower product prices and margins in key production lines.
Al-Bunyan added: “Despite the strong impact of lower petrochemical prices on the second quarter’s results, our operational performance remains strong. SABIC is still optimistic about the long-term fundamentals of the industry and continues to invest in growth. We have recently received regulatory approvals to increase our share in Al-Razi company, the world’s largest methanol complex, to reach 75% as well as renew our partnership with the Japan Saudi Arabia Methanol Company (JSMC) for another 20 years”.
Al-Bunyan continued: “In addition, all the necessary regulatory approvals for the establishment of a joint venture for the petrochemical industries with ExxonMobil in the Gulf Coast, have been obtained”.
During the second quarter, SABIC signed a memorandum of understanding for the construction of a power plant in Yanbu Industrial City for photovoltaic power generation, with a potential capacity of 200-400 megawatts (peak times).
It will be Saudi Arabia’s first large-scale renewable energy project created for the private sector.
This initiative is in line with SABIC’s overall efforts in the sustainability sector. In last June, the company launched the Roadmap for Sustainability Initiatives, which is in line with the United Nations goals for sustainable development, and sets SABIC’s goals related to resource efficiency, climate change, circular economy, food security, sustainable infrastructure, and environmental protection.