‎SABIC subsidiaries outperform on reliability; recession pressured margins: Acting CEO

‎SABIC subsidiaries outperform on reliability; recession pressured margins: Acting CEO

The performance of Saudi Basic Industries Corp.’s (SABIC) unlisted subsidiaries was close to the average of most companies, Acting CEO Abdulrahman bin Saleh Al-Fageeh told Argaam.

The performance was distinguished in terms of reliability of plants, along with quality and safety of products, he added.

The glycol markets are under pressure, Al-Fageeh said during a press conference to discuss 2022 financial results. The company succeeded in the commercial operation of the third plant for the production of ethylene glycol in Jubail United Petrochemical Co., which is the largest project for glycol production in terms of sustainability.

He indicated that the second half of 2022 witnessed economic contraction and recession, amid a rise in prices of energy, feedstock and raw materials that the company uses, which led to pressure on profit margins from July 2022 until the end of the year, and such pressure increased during the fourth quarter.

Despite the decline in average prices of petrochemical products, especially in Q4 2022, SABIC’s sales rose by 9% year-on-year in 2022 as new plants started operations and other plants improved performance, according to the top official.

He added that the increase in sales also came thanks to inventory optimization and reducing the final stock of its products.