SABIC profits fell 28% due to energy price pressures

Despite the increase in its revenues at the end of last year, 198.4 billion riyals ($ 52.9 billion), an increase of 13 percent over 2021, energy price pressures caused a reduction in the profit margins of the Saudi Basic Industries Corporation “SABIC” – the largest petrochemical production company in the world – to decline by 28 percent. cent in 2022.
Eng. Abdul Rahman Al-Faqih, the acting CEO of Asharq Al-Awsat, said that the company is optimistic about the quality and reliability of the factories, expecting that the second half of this year will witness an improvement in the demand for petrochemical products, stressing at the same time that the feedstock prices that fall under energy are putting pressure on profit margins.
And he continued during the press conference yesterday (Tuesday) held to announce the financial results of “SABIC”, that the company maintained during the past year its strong performance despite the difficult conditions that the global markets suffered from, and sales continued to grow, exceeding last year by 9 percent thanks to growth projects. Improving factory operation performance, optimizing stock utilization, and cooperating with Saudi Aramco.
SABIC announced its financial results for the fourth quarter of 2022; Revenues amounted to 42.9 billion riyals ($11.4 billion), a decrease of 8 percent compared to the previous quarter.
The results of the fourth quarter witnessed a net income of 299 million riyals ($80 million), a decrease of 84 percent compared to the previous quarter.
Last year witnessed a net income of 16.5 billion riyals ($4.4 billion), a decrease of 28 percent, compared to 23 billion riyals ($6.1 billion) in the previous year.
SABIC continued its leadership in the field of sustainable solutions throughout 2022; It has led and collaborated on many milestones in its journey towards carbon neutrality.
At the beginning of last year, SABIC introduced the BlueHero initiative, which is an expanded system of materials, solutions, expertise, and programs that aim to help accelerate the transition of the energy sector in the world to electricity.
It partnered with BASF and Linde to build the world’s first pilot plant for large-scale electric-heated steam cracking furnaces.
SABIC Agro-Nutrients and Saudi Aramco succeeded in sending the world’s first commercially approved low-carbon blue ammonia shipment to South Korea last November.
The company declared its intention to study the establishment of a complex for converting oil and liquid materials into chemicals in the Ras Al-Khair region in the Kingdom, which is expected to convert 400 thousand barrels of oil per day into chemicals. Saudi Arabia to convert oil and its liquids into chemicals.
SABIC and ExxonMobil revealed the successful start-up of the manufacturing facility of the Gulf Coast Development Project in Texas. The facility includes an ethane steam cracker with a capacity of 1.8 million metric tons per year, two polyethylene units with a capacity of 1.3 million metric tons per year, in addition to a monoethylene glycol unit with a capacity of 1.1 million metric tons per year.
Last November, SABIC inaugurated its new building in Jubail (eastern Saudi Arabia), which contributes to strengthening its local and international presence in the Kingdom and around the world.
The building was constructed using SABIC iron, the first of its kind to achieve carbon neutrality in Jubail, with a capacity of more than 3,600 employees.
It connects SABIC’s global sites by adopting the latest technologies, including advanced data systems, in addition to the environmental and operational excellence system.
Throughout the past year, the company has maintained its commitment to the environment, health, safety and security, while continuing to implement procedures and standards that guarantee a high level during 2023.