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SABIC, the Saudi chemical company, reports another unexpected loss in Q2

SABIC, the Saudi chemical giant and one of the largest petrochemicals firms in the world, announced a second-quarter loss on Sunday. The company had decided to close a cracker plant in the UK as part of a restructuring during a slowdown in the industry.

SABIC's net loss for the three-month period ending June 30 was 4,07 billion riyals (about $1.09 billion), a far cry from analyst expectations that it would be a profit in the amount of 504 millions riyals.

The opening price of the shares was 53.8 riyals, a decline of 1.6%.

SABIC, 70% owned by Saudi Aramco, has suffered three consecutive quarterly losses as the chemical industry struggles with weak demand, which has affected sales.

In its Sunday earnings report, the company stated that the losses were primarily attributed to impairment charges of 3.78 billion riyals and provisions relating to the closure of a cracker in the United Kingdom. This was in accordance with the portfolio review by the company to reduce costs and improve profitability.

SABIC's shares have fallen by almost 19% on the Saudi Exchange this year.

In a review of the business, earlier this month, it said that its National Industrial Gases Company, including an initial public offer, was undergoing a strategic analysis.

SABIC stated in a press release that the move is in line with the company's portfolio optimization strategy and its core business focus. It added that the IPO of GAS will be aimed at improving "the group's financial position and value added to shareholders".

(source: Reuters)