Saudi Arabian Mining Company (Maaden) has said its first-quarter net income declined 35.3 per cent as revenues for the largest mining company in the Gulf got hit by shrinking commodities prices.

Maaden reported a net profit SR168.9m ($45m) for the three-month period ending 31 March, down from SR260.92m for the corresponding period of 2015. The first-quarter gross profit also slumped to SR492.85m from SR615.81m from a year ago, the company said in a bourse filing.

Revenues declined by 17 per cent due to slide in commodity prices for all its products. Average prices for ammonia and DAP slipped 30 per cent and the revenues also got affected by a 25 per cent slide in aluminium, where overall sales also fell.

“The impact on profitability from the decline in revenues was partly offset by a 16 per cent reduction in cost of sales through lower raw material costs and the effects of the company’s ongoing initiative to reduce operating costs,’’ Maaden said in the statement.

Government-controlled Ma’aden, which operates in gold, aluminium and phosphates, is a key to Saudi Arabia’s drive to diversify its economy, which relies heavily on sale of hydrocarbons for revenues.

The firm had reported a loss or falling profits in the preceding three quarters and its chief executive in October told news agency Reuters that the firm was reviewing spending plans.

The company has turned to bank finance to manage its funding requirements. Maaden Phosphates Company (MPC) closed a SR11.5bn refinancing deal, two banking sources told MEED on 13 January. Maaden in November 2015 announced that its subsidiary had received commitment letters from local and international banks. The refinancing cut borrowing costs on facilities signed in 2008.

Maaden Waad al-Shamal Phosphate Company another Maaden subsidiary in January borrowed SR4bn in four separate loans from Saudi Industrial Development Fund to construct chemical plans in the kingdom.