Borouge Q2 performance buoyed by operations, resilience: CEO

Borouge CEO Hazeem Al Suwaidi as saying Q2 performance was driven by higher selling prices, operational recovery, and resilient supply chains.

Borouge plc delivered strong Q2 2026 results despite challenging regional headwinds, CEO Hazeem Al Suwaidi told Argaam, underscoring the company’s swift response to the earlier incident at Ruwais, in addition to its commercial and logistic resilience.

“Borouge worked with its partners to implement alternative logistics routes that enabled continued export operations and access to global markets.”

Al Suwaidi indicated that "Borouge 4" project boosted company production capacity by 1.4 million tons, enhancing its ability to meet growing demand.

He also expects average achieved selling prices to remain at supportive levels in the near term, adding that the company is planning to distribute annual dividends of 16.2 fils per share.

Borouge net profit increased 23% quarter-on-quarter to AED 701 million, while revenue rose 20% from the previous quarter to AED 5.16 billion. The performance was driven by the company's swift and coordinated response to the incident at Ruwais Industrial City earlier this year, coupled with record premiums achieved by Borouge's differentiated products. By the end of June, the company had fully restored operational readiness across all assets, activated alternative logistics routes, and successfully shipped all production volumes during the quarter, in addition to significant volumes from existing inventories. These achievements highlighted Borouge's operational strength and commercial agility, enabling it to continue meeting customer demand while delivering value to shareholders.

Maintaining uninterrupted customer supply remained Borouge's top priority throughout the regional disruptions. Working closely with its partners, the company established alternative logistics corridors that enabled exports to continue and ensured access to global markets, the CEO noted.

Borouge, by diversifying transportation options across road, sea, and rail networks, strengthened its supply chain and shipped all available production volumes, along with substantial quantities from inventory, without relying on the Strait of Hormuz. These measures supported quarterly sales volumes of 0.9 million tons and reinforced Borouge's reputation as a reliable long-term supplier capable of meeting customer requirements under challenging conditions, Al Suwaidi told Argaam.

While earnings improved, profitability margins came under temporary pressure from higher logistics costs and increased propylene feedstock prices, reflecting market conditions amid regional disruptions during the quarter. However, these cost pressures were partly offset by a 53% quarter-on-quarter increase in average selling prices, supported by stronger global polyolefin prices and record premiums for Borouge's differentiated products. As a result, the company generated EBITDA of AED 1.47 billion, demonstrating the resilience of its business model despite the temporary increase in operating costs.

Borouge also continued to advance its long-term growth strategy despite the challenging environment, said Al Suwaidi. The Borouge 4 project remains a key growth driver and is expected to increase the company's production capacity by 1.4 million tons, strengthening its ability to meet rising customer demand and create long-term shareholder value, he added.

During the quarter, and despite exceptional operating conditions, Borouge's new cross-linked polyethylene (XLPE) plant entered commercial operations and delivered its first shipment to customers. The facility is expected to add 100,000 tons of annual production capacity, doubling Borouge PLC's XLPE output and enhancing its ability to supply high-value, advanced polyolefin solutions.

Al Suwaidi also highlighted the strategic benefits of becoming part of Borouge International, citing broader geographic diversification, expanded market access, greater business scale, and enhanced innovation capabilities through the new group's advanced technologies. During the second quarter, Borouge International's operations in North America and Europe benefited from improving market conditions, underscoring the value of its diversified geographic footprint. In its first three months of operation, the company generated EBITDA of AED 6.7 billion.

Looking ahead, Borouge expects to return to high operating rates following the restoration of full operational capacity across all assets ahead of schedule, supported by improving logistics conditions and greater feedstock availability.