MOSCOW (MRC) -- Saudi Kayan swung to a net loss in 2019 following a drop in selling prices, despite a rise in sales volumes, said Tadawul.
The reason for achieving a net loss is due to the decrease in the average selling prices of the products, despite an increase in the quantities produced and sold and a decrease in the average cost of feedstock and general and administrative expenses.
Saudi riyals (SR) million 2019 2018 % change
Sales 9,536.40 12,263.15 -22.2
Operational profit 379 2,660.58 -85.8
Net profit -636.77 1,702.24
Full-year earnings were also weighed by the decrease in the average cost of feedstocks as well as higher general and administrative expenses, the company said in a filing to the Saudi bourse, Tadawul.
As MRC informed earlier, Saudi Kayan announced a 21-day scheduled maintenance shutdown for its ethylene glycol (EG) and ethylene oxide (EO) facilities at Jubail, Saudi Arabia, starting on 1 February. The company says that some of its other facilities that rely on EG and EO feedstocks will also undergo periodic maintenance and improvements.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
Saudi Kayan Petrochemical Company is a manufacturing affiliate of the Saudi Basic Industries Corporation (Sabic, 35%). Saudi Kayan is the fifth-largest petrochemical manufacturer by market value in Saudi Arabia.
MRC