Logo of Advanced Petrochemicals Co.
Advanced Petrochemicals Co.’s Q4 2020 earnings of SAR 180 million came in-line with AlJazira Capital estimates of SAR 178.1 million but below market consensus estimate of SAR 197 million.
Despite the challenging environment due to COVID-19, the company showed resilient operating performance, the brokerage firm said in an earnings review.
Going forward, AlJazira Capital expects products prices to stabilize around the current level with the pick-up in the global economic activities. However, a significant improvement is not expected during FY2021 due to expected global additional new capacities.
For FY2021, the firm expects Advanced to gradually return to its pre-COVID sales level after Q1 2021, driven by an expected further recovery of global demand and selling prices.
In the long-term, the progress on the new expansion plan will be the key catalyst for the future performance.
AlJazira Capital expects Advanced to post a net profit of SAR 818.7 million for FY2021, as compared to a net profit of SAR 596 million in FY2020.
The firm maintained its “Neutral” recommendation for Advanced, with a target price of SAR 60.60 per share.
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