Dubai, Riyadh: First-quarter profit at Saudi Basic Industries Corp (Sabic), the Middle East’s biggest petrochemicals producer, rose on higher prices and sales volumes, in spite of a 1.1 billion Saudi riyal ($290 million) charge for restructuring.
Net income increased 5.4 per cent to 5.51 billion riyals compared with the same quarter a year earlier, the Riyadh-based company said in a statement to the Saudi stock market. The result was in line with an estimate of 5.55 billion riyals from three analysts compiled by Bloomberg. Sales rose 15 per cent to 41.9 billion riyals over the period.
Sabic, as the company is known, proposed this month to build a headquarters in Houston for its western hemisphere operations to capitalise on the US shale boom. It also plans to build factories in Africa and is considering three countries for the investment, Chief Executive Officer Yousuf Abdullah Al Benyan told reporters in Riyadh on Sunday, without specifying the nations.
Sabic shares were 0.1 per cent higher at 118.80 riyals on the Saudi stock exchange at 11:12am local time. The shares have climbed 17 per cent this year as the price of crude oil, a petrochemicals feedstock, increased 12 per cent.
The company is targeting several regions for potential mergers or acquisitions, including the US, Europe and China, as well as Africa, Al Benyan said. “We hope that by the end of this year there is something new to be materialised,” he said.
Sabic’s purchase of a 24.99 per cent stake in Swiss chemical maker Clariant AG should be reflected in the Saudi company’s first-quarter earnings, Al Benyan said in January. He told reporters on Sunday it was premature to discuss a possible increase in this stake.
Sabic has 27 billion riyals in borrowings maturing this year, all of which are subject to “our normal assessment and options” for possible refinancing, Al Benyan said. “We will assess them according to their return on investment,” he said.