Almarai says third-quarter profit flat, warns of tough market conditions

Almarai said on October 15 that Public Investment Fund, Saudi Arabia’s top sovereign wealth fund, had increased its share capital in the company to 16.32 percent. (Reuters)
Updated 22 October 2017
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Almarai says third-quarter profit flat, warns of tough market conditions

DUBAI: Saudi Arabia’s Almarai, the Gulf’s largest dairy company, reported a flat third-quarter net profit on Sunday, and warned it remained cautious on the year due to adverse market conditions.
Almarai made a profit of 667 million riyals in the three months to September 20, compared to a revised quarterly profit of 664.3 million riyals in the year-earlier period, according to a bourse statement.
Four analysts polled by Reuters had forecast on average that Almarai would make 620.75 million riyals.
Revenue was down 4.5 percent to 3.37 billion riyals from the same period a year earlier.
Almarai said tough market conditions continued into the third quarter and that its end of year outlook remains cautious, citing reasons such as higher operating costs, devaluation of the Egyptian pound and lower exports.
Almarai has lost access to the Qatari market since June after Saudi Arabia severed trade and travel links with its neighbor in the Gulf’s most severe diplomatic split in years.
Almarai said on October 15 that Public Investment Fund, Saudi Arabia’s top sovereign wealth fund, had increased its share capital in the company to 16.32 percent.


Brent oil trades near 4-year high, but US crude retreats

Updated 26 September 2018
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Brent oil trades near 4-year high, but US crude retreats

  • The US will apply sanctions to halt oil exports from Iran, the third-largest OPEC producer, starting on November 4
  • Brent is on course for its fifth consecutive quarterly increase, the longest such stretch for the global benchmark since early 2007

TOKYO: Brent crude was trading around its highest in nearly four years on Wednesday, while US crude futures fell as Washington tried to assure consumers that the market would be well supplied before sanctions are re-imposed on producer Iran.
Brent crude futures were up 10 cents, or 0.1 percent, at $81.87 a barrel by 0645 GMT, after gaining nearly 1 percent the previous session. Brent rose on Tuesday to its highest since November 2014 at $82.55 per barrel.
US crude futures were down 4 cents at $72.24 a barrel. They climbed 0.3 percent on Tuesday to close at their highest level since July 11.
The US will apply sanctions to halt oil exports from Iran, the third-largest producer in the Organization of the Petroleum Exporting Countries (OPEC), starting on November 4. The pending loss of Iranian supply has been a major factor in the recent surge in crude prices.
US officials, including President Donald Trump, are trying to assure consumers and investors that enough supply will remain in the oil market while requesting producers raise their output.
“We will ensure prior to the re-imposition of our sanctions that we have a well-supplied oil market,” Washington’s special envoy for Iran, Brian Hook, told a news conference at the United Nations General Assembly on Tuesday evening.
In an earlier speech at the UN, Trump reiterated calls on OPEC to pump more oil and stop raising prices. He also accused Iran of sowing chaos and promised further sanctions on the country.
The so-called ‘OPEC+’ group, which includes the world’s biggest producer Russia, met over the weekend but did not see the need to add new output as the market is well-supplied currently.
“The lack of new production growth guidance by OPEC does not reflect a desire to let prices appreciate meaningfully further, but rather the historical pattern of OPEC responding to rather than front-running production losses,” Goldman Sachs said in a report.
“We continue to expect that the decline in Iran exports will reach 1.4 million barrels per day, and while it is occurring faster than we had previously expected, we continue to expect it to remain offset by a faster ramp-up in production from other producers.”
The investment bank reiterated its view that “Brent prices will stabilize back in their $70-80/bbl range into year-end.”
Brent is on course for its fifth consecutive quarterly increase, the longest such stretch for the global benchmark since early 2007, when a six-quarter run led to a record-high of $147.50 a barrel.
Meanwhile, in the US, the world’s biggest oil user, an industry report on Tuesday showed crude stockpiles unexpectedly climbed last week.
Crude inventories rose by 2.9 million barrels in the week to Sept. 21 to 400 million, compared with analyst expectations for a decrease of 1.3 million barrels, the American Petroleum Institute said.
Official figures on stockpiles and refinery runs from the US Department of Energy’s Energy Information Administration are due at 10:30 a.m. EDT (1430 GMT) on Wednesday.