Profits surge on back of rise in sales volume and prices
Saudi Basic Industries Corporation (Sabic), the world’s biggest petrochemicals manufacturer, has reported profit of SR5.43bn ($1.45bn) in the first quarter of 2010, compared to a net loss of SR970m for the same quarter in 2009.
Meanwhile, profit increased by 19 per cent from the SR4.58bn posted in the fourth quarter of 2009, according to company results released on 18 April.
The profit increase is from a rise in both production and sales volumes, as well as an improvement in the prices of most petrochemical products and plastics.
“This quarter witnessed the first production from units Yansab, Sharq and Tainjin in China,” says Mohamed al-Mady, Sabic vice-chairman and chief executive officer. “This will support Sabic results from the second quarter.”
Yansab and Sharq are subsidiaries of Sabic, while Tainjin is a joint-venture petrochemical complex in China operated by both Sabic and China Petroleum & Chemical Corporation.
Al-Mady also said there has been a huge improvement at Sabic Innovative Plastics, the US unit purchased from General Electric for $11.6bn in 2007, as demand for materials needed to make automobiles and electronic goods increased during the first quarter of the year.
The economic slowdown considerably slashed demand for Sabic Innovative Plastics products, contributing largely to Sabic’s SR970m loss last year, its first loss since the fourth quarter of 2001.
Earnings per share stood at SR1.81 at the end of March 2010, compared to a loss of SR0.32 per share for the same date in 2009.
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