Saudi Arabia petrochem firm Advanced's Q1 profit grows 66%

Tadawul-listed chemical giant's Q1 2019 financials revealed a 29% year-on-year hike in revenues as material costs decline

Advanced has seen a 66% increase Q1 net profits.
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Advanced has seen a 66% increase Q1 net profits.

Q1 2019 net profits at Saudi Arabia’s Advanced Petrochemical Company have risen by 66% compared to Q1 2018, with revenues up over a quarter for the same period.

According to its financial results for the three months ending 31 March, 2019, net profit after zakat and tax at the Tadawul-listed chemicals giant stood at $43.2m (SAR162m) – significantly higher than 2018’s corresponding figure of $26m (SAR97.6m).

Revenues fared similarly well, hitting $172.8m (SAR648m) for the first three months of 2019. This figure represented a 29% increase on 2018’s corresponding figure of $134.3m (SAR503.82m).

In its Tadawul missive, Advanced attributed its net profit increase to a 38.9% increase in sales volume and a drop of 20.7% and 13.3% in propane and outsourced propylene prices respectively.

A share of profits on its investment in SK Advanced Company also contributed to the group’s net profit increase.

Profits from SK Advanced contributed $5.5m (SAR20.7m) to the group’s overall profits, a figure that is more than twice the Q1 2018 value of $2.7m (SAR10.2m).

Advanced’s Q1 2019 figures came just two months after it reported net profits after zakat and tax of $191.1m (SAR716.7m) for 2018, a 14% increase on 2017 when the corresponding figure stood at $168.3m (SAR631.1m).

December 2018 saw the group announce a $350.6m engineering, procurement, and construction contract (EPC) contract for the construction of a new polypropylene plant in South Korea’s southern port city of Ulsan.

According to a Tadawul filing at the time, commercial operations on the Korean plant are expected to start in the first half of 2021.

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