JEDDAH, 23 January 2006 — Saudi Arabia’s petrochemical giant Saudi Basic Industries Corporation (SABIC) posted a record profit of SR19.2 billion last year, it was announced yesterday. The figure is much higher than last year’s profit of SR14.2 billion.
Mohamed Al-Mady, SABIC vice chairman & CEO and Saudi Arabian Fertilizer Company (SAFCO) chairman & managing director, said, “SABIC’s profits in 2005 were the highest ever reported, exceeding the previous record profits reported in 2004 by 35 percent. This is due to price increases in major products, a rise in overall production capacity to 46.7 million metric tons and an increase in overall sales to 36.6 million metric tons, a 9-percent increase over 2004.
SABIC achieved fourth quarter net profits of SR4.5 billion, down 6 percent from the previous quarter.
“The fourth quarter 6-percent decrease in profits compared to the profits in third quarter can be attributed to the difference in prices of some raw materials from different periods, which have been charged to fourth quarter”.
Al-Mady praised key successes in 2005, including the Standard & Poor’s and Fitch Ratings assigning of SABIC a Corporate Credit Rating of A, the offering of Yanbu National Petrochemical Co. (YANSAB) shares for public subscription, the completion of the FANAR project in third quarter 2005 and the new UNITED affiliate operating with full capacity, thus adding more value to the company’s overall performance. Al-Mady added that expansion projects currently under way are progressing on track and most of them are expected to be completed by the end of 2008.
Al-Mady expressed his utmost appreciation and thanks to the SABIC board of directors under the chairmanship of Prince Saud ibn Abdullah ibn Thunayan Al-Saud, for their extensive support in helping to achieve the corporate objectives and future ambitions. He also praised the sustained efforts of SABIC and its affiliates’ employees for their contributions in achieving these results.
In addition, the SABIC board of directors has recommended to the SABIC General Assembly, that there should be a distribution of dividends to shareholders of SR23 per share for 2005.
Meanwhile, the Saudi Arabian Fertilizer Company (SAFCO) reported a record 2005 net profit of SR1.1 billion compared to SR660 million in 2004. Fourth quarter 2005 net profits were SR281.4 million compared to SR251.5 million in the same period in 2004.
Al-Mady, said, “SAFCO’s profits in 2005 were the highest ever reported, exceeding the previous record profits reported in 2004 by 67 percent. This is due to price increases in major products, a 2-percent rise in production and a 10-percent increase in overall sales in 2005 compared with 2004.
“The fourth quarter 18-percent decrease in profits compared to the profits in third quarter can be attributed to a decrease in the volume of sales by 13 percent and the rise of costs associated with the periodical maintenance of SAFCO-3 plants in Al-Jubail Industrial City. The SAFCO-4 expansion project is expected to begin commercial production in 2Q2006.”
SABIC is the largest public company in the Middle East, ranked by market capitalization of more than $150 billion, and one of the world’s 10 largest petrochemicals manufacturers. The company is among the world’s market leaders in the production of polyethylene, polypropylene, glycols, methanol, MTBE and fertilizers as well as the fourth largest polymer producer.
