SABIC expects $3.5B capex in 2025

Saudi Basic Industries Corp. (SABIC) expects full-year capital expenditure to range between $3.0-3.5 billion, the petrochemicals major said in its Q2 2025 earnings release.

The Tadawul-listed firm underlined that it will continue the pursuit of creating long-term value through operational excellence, transformation, and selective growth as part of its outlook.

Market confidence remained low during Q2 2025, affected by persistent global economic uncertainty and ongoing geopolitical tensions. Meanwhile, global GDP growth stabilized at 2.5%, and the average manufacturing PMI remained slightly below 50 points, indicating sustained weakness in demand.

Total free cash flows totaled SAR 0.87 billion ($0.23 billion) in Q2 2025, up compared to the previous quarter, supported by strong cash flow from operations.

From June 16, 2020, when Saudi Aramco formally acquired 70% of SABIC shares), till June 30, 2025, the captured value of SABIC’s association with Saudi Aramco amounted to SAR 10.6 billion [$2.8 billion] including synergies of SAR 0.94 billion [$0.25 billion] realized in the second quarter of 2025.

CEO Abdulrahman Al-Fageeh said in the statement that the global GDP growth stabilized at 2.5% in Q2 2025, and due to excess production capacity, operating rates remain below historical global averages, resulting in margin pressure caused by oversupply. The manufacturing purchasing managers’ index (PMI) remains below 50 for the quarter.

Commenting on SABIC’s Q2 financial results, he emphasized that, given the persistent challenges in the chemicals market, the company made a disciplined decision to adjust its dividends in line with current market conditions. He highlighted SABIC’s balanced approach to capital allocation, ensuring competitive dividend payouts across economic cycles while supporting sustainable long-term value creation.

He further stated that SABIC’s strategic growth projects, most notably the SABIC Fujian Complex in China and the Methyl Tertiary Butyl Ether (MTBE) plant at Petrokemya in Saudi Arabia, are progressing in line with budget and planned timelines.

He added that cost optimization initiatives, launched in Q1 2025 under SABIC’s comprehensive transformation program, are currently being implemented. This program aims to deliver $3 billion in recurring annual EBITDA improvements by 2030, driven by efficiency and value-creation efforts.

According to Argaam data, SABIC sustained a net loss of SAR 5.28 billion for H1 2025, compared to a net profit of SAR 2.43 billion in the same period of 2024, with Q2 2025 losses at SAR 4.1 billion.