Riyadh, (Business News Report)|| Saudi Basic Industries Corporation (SABIC) has achieved significant profits in the first quarter of this year, compared to the same quarter of last year.
SABIC has achieved profits amounted to 6.5 billion riyals in the first quarter of 2022, an increase of 33% from the first quarter of 2021.
Profits in the first quarter of last year amounted to 4.8 billion riyals.
The reason for the increase in net profit during the current quarter is mainly due to the increase in the average selling prices of products and an increase in the quantities sold.
Despite the increase in selling and distribution expenses and the recording of provisions for a decrease in some financial assets by 0.38 billion riyals, the share of SABIC amounted to 0.38 billion riyals.
SABIC said in a statement published on the website of the Tadawul group, that the reason for the increase in net profit during the current quarter compared to the same quarter of the previous year is mainly due to the increase in the average selling prices of products and an increase in the quantities sold despite the increase in expenses of sale and distribution.
The company added that the increase in profits comes despite the recording of provisions for a decrease in some financial assets of 0.38 billion riyals, of which SABIC’s share amounted to 0.38 billion riyals.
On the reasons for the increase in profits on a quarterly basis, SABIC said that it came as a result of a decrease in operating expenses and a decrease in the recording of provisions for depreciation in the value of some financial and capital assets and provisions for restructuring by an amount of 0.54 billion riyals, of which SABIC’s share is 0.38 billion riyals.
The company pointed out a decrease in the financing burden by an amount of 0.72 billion riyals, compared to the previous quarter, due to the impact resulting from the re-measurement of derivatives of equity instruments for future contracts related to agreements of some joint ventures in the previous quarter, which are non-cash in nature.
In a related context, the CEO of SABIC Saudi Arabia, Youssef Al-Benyan, expected that the second half of 2022 would witness pressures due to slow growth and inflation.
Al-Benyan also added that there are no plans to access the debt markets.
He said that SABIC provided a strong financial performance during the first quarter, supported by the continued demand for the company’s products, the rise in oil prices, the diversity of the company’s products, as well as the distribution of its business and sales globally.
Al-Benyan also confirmed the start of SABIC’s start of operating the joint venture for the petrochemical complex on the American Gulf Coast, which efforts succeeded in completing the specified time frame and within the allocated budget, stressing that the company will continue to work on achieving a global growth strategy that focuses on owning competitive feedstock sources and enhancing global presence.