SABIC announces SR20.3 billion record profits in 2006
Saudi Basic Industries Corporation (SABIC) reported a record 2006 net profit of SR 20.3 billion compared to SR 19.2 billion in 2005, an increase of 6%. These are the highest profits achieved by the company since its inception and has resulted in an increase in earning per share to reach SR 8.13 compared to SR 7.66 in 2005.
SABIC also reported record operating profits, production, sales and revenues. The total operating profits amounted to SR 35.3 billion compared to SR 33.1 billion in 2005, an increase of 7%. The total production of SABIC’s manufacturing complexes was 49.1 million tons in 2006 compared to 46.7 million tons in 2005, an increase of 5%. A total quantity of 38.5 million tons was marketed compared to 36.6 million tons, an increase of 5% over 2005. Sales revenues hit SR 86.5 billion compared to SR 78.3 billion in 2005, an increase of 11%. These are the highest revenues achieved by the company since its inception.
The results of 4Q2006 showed net profits amounting to SR 6.1 billion compared to SR 4.5 billion during the same period in 2005, an increase of 36%.
Prince Saud Ibn Abdullah Ibn Thunayan Al-Saud, Chairman of the Royal Commission for Jubail and Yanbu and Chairman of SABIC, said that these record profits are primarily due to the improvement in prices of most of the company’s products and the increase in sales.
Prince Saud said that SABIC has completed its strategic plan for 2020 which will help achieve high growth rates, diversify and introduce value added products.
On December 29, 2006 SABIC completed the acquisition of the purchase of Huntsman’s UK base chemicals and polymers business for a purchase price of US$ 685 million in cash. The acquisition marks a significant step in SABIC’s global growth plans. It will contribute, alongside other ongoing expansion projects at YANSAB, SHARQ, AR-RAZI, SAUDI KAYAN, GAS, IBN ZAHR and SABIC Europe, which implementation works are well underway, to increasing the production capacity to 73 million tons by 2009.
In its last meeting, SABIC board of directors recommended to the general assembly to distribute SR 10 billion cash dividends to shareholders at SR 4 per share for 2006 of which SR 1.5 per share was paid during 2006.