Saudi Basic Industries Corp (Sabic) posted record net profit in the third quarter of US$2.2 billion on the back of increased sales and reduced funding costs.
In a company statement, Sabic said it saw a 54 per cent rise in net profits of US$2.2 billion in the three months ended September 30th. Sabic's revenue rose to US$13 billion from US$10.1 billion a year earlier.
Operating income also increased by 50 per cent to US$3.6 billion from US$2.4 billion a year earlier, while operating income in the nine-month period surged 41 per cent to US$10.4 billion.
The Saudi investment bank NCBC, stated that the impressive Q3 results were the result of increased production and sales volumes, higher selling prices and lower financing costs.
Mohamed Al-Mady, vice-chairman and chief executive, argued Sabic was in a good position to deal with an another economic downturn and that Sabic’s growth was partly down to the company’s ability to serve developing economies such as China and India.
"The diversity of Sabic products reduces market risks considerably and Sabic is benefiting from a stable economic situation in Saudi Arabia," Mr. Al Mady said. "Our growth plans and projects are moving forward according to the company's strategy...as a matter of fact, when the economic situation gets bad, it is time to invest," Mohamed Al-Mady said at a press conference.
Sabic is benefiting from the low cost of feedstock giving the company a competitive edge over many producers elsewhere that use naphtha, a crude derivative whose price has risen in line with oil prices.
