Tadawul-listed petrochemical firms’ combined net profit fell 31 percent year-on-year (YOY) to SAR 19.43 billion in the first nine months of this year on price declines and plant shutdowns, a study by Argaam Research showed.
Combined sales reached SAR 182.2 billion during nine-month period, marking a 28 percent drop compared to the same period in 2014.
Profit margin also declined 1.27 percent YOY to 25.1 percent till September 30.
|
Consolidated earnings for petrochemicals sector in nine-month-2015 (SAR bln) |
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|
Change |
Sep.2015 |
Sep.-2014 |
Item |
|
(28%) |
182.20 |
252.29 |
Revenue |
|
(31%) |
45.72 |
66.51 |
Gross income |
|
(1.27%) |
25.09% |
26.36% |
Gross income margin |
|
+1% |
(14.22) |
(14.41) |
Operating expenses |
|
(27%) |
31.60 |
43.34% |
Operating income |
|
(3%) |
(2.88) |
(2.98) |
Financing expenses |
|
(31%) |
19.43 |
27.97 |
Net profit |
Eight companies—Methanol Chemicals Co. (Chemanol), Rabigh Refining and Petrochemical Co. (Petro Rabigh), Saudi Kayan Petrochemical Co., Yanbu National Petrochemical Co. (Yansab), Advanced Petrochemical Co., Alujain Corporation, Nama Chemicals and Saudi Arabia Fertilizers Co. (SAFCO)— saw their operations temporarily stopped due to scheduled maintenance or technical glitches.
National Petrochemical Co. (Petrochem) and Advanced were the only gainers in the sector, registering profit rises of 25 percent and three percent respectively on year for the first nine months.
Chemanol, National Industrialization Co. (Tasnee), Nama and Kayan reported a combined net loss of SAR 1.48 billion for the period.
Other sector players saw profit declines, led by Petro Rabigh with a 72 percent drop YOY.
The sector’s third-quarter net profit decreased 21 percent YOY, as the prices of most petrochemical products trended down when compared to Q3-2014.
Saudi Basic Industries Corp. (SABIC) posted a nine percent YOY decline in Q3 profit to SAR 503 million.
Meanwhile, Petrochem and Yansab recorded higher sequential profit.
Petro Rabigh turned to a net loss of SAR 460 million in Q3, compared to a net profit of SAR 505 million in the previous quarter, as the company failed to dispose of its inventory during the fourth quarter last year.
Trailing twelve months (TTM), the sector trades at an average price/earnings ratio (P/E) of 14.6 times; below the market’s average of 16.3 times. It also trades at a combined price/book ratio (P/B) of 1.55 times compared to the market’s multiple of 1.74 times.
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Performance of petrochemical companies in nine-month 2015 (SAR mln) |
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|
Change |
Sep.2015 |
Sep.2014 |
Company |
|
(257%) |
(79.2) |
50.4 |
Chemanol |
|
+25% |
728.3 |
582.2 |
Petrochem |
|
(18%) |
15,709.0 |
19,077.0 |
Sabic |
|
(27%) |
1,751.9 |
2,394.9 |
SAFCO |
|
(176%) |
(737.0) |
972.8 |
Tasnee |
|
(23%) |
78.9 |
102.2 |
Alujain |
|
+27% |
(48.7) |
(66.6) |
Nama Chemical |
|
(21%) |
672.0 |
847.2 |
SIIG |
|
(73%) |
82.9 |
302.0 |
Sahara Petrochemical |
|
(56%) |
814.3 |
1,860.0 |
Yansab |
|
(45%) |
262.3 |
473.8 |
Sipchem |
|
+3% |
567.0 |
550.8 |
Advanced Petrochemical |
|
(1000%) |
(618.9) |
(56.2) |
Saudi Kayan |
|
(72%) |
250.2 |
879.0 |
Petro Rabigh |
|
(31%) |
19,433.4 |
27,969.5 |
Total |
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