RIYADH: Chemical manufacturer Saudi Basic Industries Corp. posted a net profit of SR1.54 billion ($410.6 million) in 2024, rebounding from a SR2.77 billion loss the previous year, driven by improved operations and lower losses from discontinued operations.
The company’s revenue dipped 1 percent to SR139.98 billion amid lower sales volumes, partly offset by 1 percent higher average selling prices, SABIC said in a statement.
Operating income jumped 54 percent to SR5.74 billion, driven by a 16 percent rise in gross profit to SR25.62 billion.
At a press conference held at the company’s headquarters, CEO Abdulrahman Al-Fageeh stressed the firms’s ability to sustain strong performance and profitability.
“Despite the challenges facing the petrochemical industry, SABIC’s operations and business remain resilient, and we continue to deliver solid and stable EBITDA (earnings before interest, taxes, depreciation, and amortization) margin,” he said.
The company said monetary easing is supporting recovery in the petrochemicals sector, but “overcapacity remains a challenge,” particularly for polymers.
“Ethylene demand growth remains slower than capacity growth, leading to sustained pressure on capacity utilization rates,” said Al-Fageeh, in a statement.
The company’s earnings before interest, tax, zakat, depreciation, and amortization for 2024 amounted to SR19.4 billion, up from SR19 billion in 2023. The EBITDA margin improved slightly to 13.9 percent compared to 13.4 percent in the previous year.
With this growth, SABIC retained its position as the second-most valuable global chemical brand, with a brand value of $4.9 billion.
Meanwhile, total shareholders’ equity after deducting minority interests stood at SR156.8 billion, reflecting a 6.3 percent decline from SR167.4 billion in 2023.
SABIC credited the turnaround to several factors:
- Discontinued operations losses fell by SR3.5 billion, mainly from adjustments to the fair value of Saudi Iron and Steel Co.
- Operating income grew by SR2 billion, aided by stronger gross profit despite higher costs.
- Zakat expenses dropped by SR1 billion due to regulatory updates and provision reversals.
- Finance income declined by SR1.7 billion, reflecting lower gains from derivative equity instruments.
Al-Fageeh highlighted SABIC’s strong focus on workplace safety in 2024, reporting a total recordable incident rate of 0.09 — an 18 percent improvement from 2023 — underscoring its commitment to best practices and operational excellence.
The CEO said delivering value to shareholders remains a priority, as reflected in the announced $2.72 billion dividend distribution for 2024.
“Our dedication to sustainability and operational excellence remains at the forefront of our strategy as we navigate through the evolving market dynamics of 2025 and beyond,” he added.
Growth strategy
Speaking at the press conference, Al-Fageeh highlighted SABIC’s continued growth, emphasizing that the company is on track with its strategic plans.
He outlined key expansion projects, including the SR24 billion Fujian Petrochemical Complex in China and the Methyl Tertiary Butyl Ether project in Saudi Arabia.
Additionally, he highlighted a 40 percent increase in production capacity at SABIC SK Nexlene and the new ULTEM resin manufacturing facility launched in Singapore last year.
He also noted the completion of mechanical work on the pyrolysis oil plant and the commissioning of the hydrotreater unit in the Netherlands, along with the inauguration of the electrically heated cracking furnace project in partnership with BASF and Linde.
On integration with Saudi Aramco, Al-Fageeh said SABIC has realized $2.57 billion in synergy value to date, underscoring the significance of the collaboration and the need to further strengthen it.
The company has also sharpened its focus on core businesses and capital efficiency, completing the sale of Hadeed, Alba, and its Functional Forms business, which specializes in plastic films and sheets.
Outlook
Looking ahead, SABIC expects global gross domestic product to grow 2.5 percent in 2025 and remains focused on maximizing long-term value for stakeholders through operational excellence, transformation, selective growth, and value creation.
“We maintain a disciplined approach to manage our capital investment, projecting an expenditure for 2025 in the range of $3.5 billion to $4 billion,” the CEO said.
