Sipchem CEO says Q4 2022 hit by lower sales, prices; plans $12 bln investments

Abdullah Al-Saadoon, CEO of Sipchem 

Sahara International Petrochemical Co.’s (Sipchem) Q4 2022 results were hit by several factors, such as a 35% drop in average selling prices, lower quarterly sales, and a 14% increase in logistics costs, CEO Abdullah Al-Saadoon told Al Arabiya TV.  

The first quarter of 2023 showed positive signals, such as China’s reopening and India’s growth.

The petrochemical industry in Europe also suffered competitiveness due to inflation and energy prices, which gives Sipchem an opportunity to tap into this market, Al-Saadoon said, adding logistics costs have declined.

Al-Saadoon said feedstock prices jumped 15% year-on-year in the fourth quarter of 2022, ruling out that these costs will see a further increase amid stable energy prices.

Sipchem directed 65% of its sales to Asia, the key market of the company, 16% to the local market, 15% to Europe, and the remaining sales to other countries.

Elsewhere, the CEO revealed aggressive growth plans for the next decade with investments that could exceed $12 billion, concluding that Sipchem maintains a balance between dividends, reserves and debt repayment.

Sipchem posted a net profit of SAR 3.595 billion in 2022, up from SAR 3.591 billion a year earlier.

The fourth-quarter 2022 earnings hit nearly SAR 479 million, Argaam reported.