Yousef Abdullah Al-Benyan, Vice Chairman and CEO, SABIC
Saudi Basic Industries Corp.’s (SABIC) healthy financial performance during the third quarter of 2021 marked a continuation of its recovery from the impact of COVID-19, albeit, at a lower level than its exceptionally strong performance in the second quarter, Vice Chairman and Chief Executive Officer (CEO) Yousef Abdullah Al-Benyan said in a statement today, Oct. 28.
He noted that the company saw a moderation in margins in the third quarter mainly due to rising feedstock costs, which offset the increase in average sales prices.
SABIC announced the start of commissioning activities and preparations for the initial start-up of the petrochemicals joint venture project with ExxonMobil in the US Gulf Coast.
This project supports SABIC’s global growth strategy and aims to diversify feedstock sources and strengthen its petrochemical manufacturing presence in North America.
The Q3 2021 saw average sales prices increase 5% quarter-on-quarter (QoQ). However, sales volumes slightly decreased by 2% QoQ. For the first nine months of 2021, average sales prices increased 50% and sales volumes decreased 4% year-on-year (YoY).
During the third quarter, sales and supply chain activities extended their focus area to support marketing in SADARA, S-Oil and Fujian Refining & Petrochemical Co. (FREP).
From Oct. 1, SABIC began marketing Saudi Aramco’s portion of the petrochemical products in Petro Rabigh, which will allow the petrochemicals major to further strengthen its products and services offering, as well as maintain its competitive presence in the global chemicals industry.
In the fourth quarter, SABIC expects demand to be healthy but sees feedstock costs to remain elevated with higher oil prices.
“We are also seeing new capacities coming online for some of our key products. In addition, as the existing supply constraints continue to ease, we expect to see a further moderation in margins in the fourth quarter,” said Al-Benyan.
SABIC reported a net profit after Zakat and tax of SAR 18.1 billion for the first nine months of 2021, against a net loss of SAR 2.2 billion in the year-ago period. Net profit after Zakat and tax surged to SAR 5.6 billion in Q3 2021, from SAR 1.09 billion a year earlier.
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