Saudi Basic Industries Corporation (SABIC), one of the world’s largest petrochemical companies, reported a 28.35 percent decline in net profit to SR16.53 billion in 2022. The decline was attributed to lower profit margins and rising distribution costs. However, the company’s sales volume increased by 9 percent from the previous year, driven by growth projects, improved reliability, inventory optimization, and synergies with Saudi Aramco.
Abdulrahman Al-Fageeh, SABIC’s acting CEO, acknowledged the challenging market conditions but emphasized the strength of the company’s 2022 results. In a statement given to the Saudi stock exchange, Al-Fageeh said, “SABIC 2022 results remain strong despite challenging market conditions. Our sales volumes continue to grow, exceeding the previous year’s sales by 9 percent and driven by growth projects, improved reliability, inventory optimization, and synergies with Saudi Aramco.”
SABIC’s decrease in net income was mainly due to lower profit margins for most of its key products. Higher feedstock prices and an increase in selling and distribution costs also contributed to the decline. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) for 2022 stood at SR38.57 billion, a 20 percent fall compared to 2021. SABIC’s income from operations was SR23.88 billion in 2022, 29 percent lower than the previous year.
Despite the decline in profits, SABIC remains optimistic about its future growth prospects. The company has made significant investments in research and development, innovation, and sustainability to strengthen its position in the market. SABIC is also focused on expanding its product portfolio and increasing its global presence.
SABIC’s sales volumes have been steadily increasing in recent years, thanks to its focus on innovation and customer-centric approach. The company has been investing in growth projects and improving its supply chain to better serve its customers. SABIC has also been working closely with Saudi Aramco, its parent company, to leverage synergies and optimize its operations.
SABIC’s commitment to sustainability is also driving growth and innovation. The company has set ambitious targets to reduce its carbon footprint and improve its environmental performance. SABIC is investing in renewable energy and sustainable products to meet the growing demand for eco-friendly solutions.
SABIC’s 2022 financial results reflect the challenging market conditions faced by the petrochemical industry. However, the company’s sales volume growth, focus on innovation, and commitment to sustainability are positive indicators of its future prospects. SABIC’s strong partnership with Saudi Aramco and its investments in growth projects and sustainability initiatives position the company well for future success. As SABIC continues to navigate the changing market dynamics, its customer-centric approach, and commitment to innovation and sustainability will remain critical to its growth and success.
