Luberef posts 5% profit drop to SAR 1.214 bln in 9M 2022; Q3 at SAR 474.8 mln
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Saudi Aramco Base Oil Co. (Luberef) reported a net profit of SAR 1.214 billion in the first nine months of 2022, a decline of 5% from SAR 1.281 billion a year earlier.
Financials (M)
| Item | 9m 2021 | 9m 2022 | Change |
|---|---|---|---|
| Revenues | 6,430.79 | 8,805.06 | 36.9 % |
| Gross Income | 1,704.04 | 1,749.71 | 2.7 % |
| Operating Income | 1,497.78 | 1,529.11 | 2.1 % |
| Net Income | 1,281.71 | 1,214.89 | (5.2 %) |
| Average Shares | 168.75 | 168.75 | - |
| EPS (Riyals) | 7.60 | 7.20 | (5.2 %) |
The nine-month earnings were hit by gross profit margins, which contracted to 20%, compared to 26% in the first nine months of 2021.
Operating profit margins decreased to 17% from 23% in the nine-month period of 2021. Additionally, Zakat provisions increased by 63% year-on-year (YoY) in the current period.
This came despite a 37% YoY jump in revenue and an 11% fall YoY in financing costs.
The third-quarter net profit rose 3% to SAR 474.8 million, from SAR 459.3 million in Q3 2021, backed by a 14% YoY leap in revenue. Financing costs fell 19% YoY. Luberef also reported finance income of SAR 8 million in Q3 2022, compared to SAR 1.7 million a year earlier.
Current Quarter Comparison (M)
| Item | Q3 2021 | Q3 2022 | Change |
|---|---|---|---|
| Revenues | 2,378.60 | 2,721.82 | 14.4 % |
| Gross Income | 609.71 | 649.94 | 6.6 % |
| Operating Income | 543.17 | 583.04 | 7.3 % |
| Net Income | 459.38 | 474.79 | 3.4 % |
| Average Shares | 168.75 | 168.75 | - |
| EPS (Riyals) | 2.72 | 2.81 | 3.4 % |
On the other hand, gross profit margins went down to 24% from 26% in Q3 2021. Net profit margins also declined to 21% from 23% in Q3 2021. The company also posted a 42% increase YoY in the third-quarter Zakat provision.
Shareholders’ equity, no minority interest, reached SAR 4.351 billion as of Sept. 30, 2022, up from SAR 4.244 billion in the prior-year period.
Luberef reported a cash balance of SAR 1.653 billion as of Sept. 30, 2022. Cash flows from operations stood at SAR 1.409 billion.
Revenues from base oil sales rose to SAR 4.409 billion in the first nine months of 2022, from SAR 3.555 billion in the year-earlier period.
By-products recorded revenues of SAR 4.395 billion, up from SAR 2.875 billion in the nine-month period of 2021.
By region, Luberef reported revenues of SAR 5.987 billion in Saudi Arabia, compared to SAR 4.067 billion in the nine-month period of 2021.
Revenues from the UAE jumped to SAR 1.562 billion in the first nine months of 2022, compared to SAR 1.414 billion a year earlier.
Revenues from Indian operations reached SAR 733.73 million, up from SAR 522.17 million in the same period of 2021.
Singapore reported revenues of SAR 176.37 million in 9M 2022, from SAR 203.60 million a year earlier.
Revenues from Egypt grew to SAR 170.75 million, from SAR 27.80 million in 9M 2021.
Luberef also generates SAR 11.23 million revenues from the US in 9M 2022, compared to SAR 88.80 million a year earlier.
Revenues from other regions stood at SAR 163.25 million, up from SAR 106.71 million in 9M 2021.
Financial results (Million)
| Period | Revenues | Change | Gross Income | Change | Operating Income | Change |
|---|---|---|---|---|---|---|
| Q1 2022 | 2,740.74 | 53.6 % | 506.43 | 23.0 % | 420.32 | 21.6 % |
| Q2 2022 | 3,342.50 | 47.4 % | 593.34 | (13.1 %) | 525.74 | (13.7 %) |
| Q3 2022 | 2,721.82 | 14.4 % | 649.94 | 6.6 % | 583.04 | 7.3 % |
Profit Performance (Million)
| Period | Net Income | Change | EPS(Riyal) | Extraordinary Income/Expense | Net Profit Before Unusual Items | EPS Before XO Items |
|---|---|---|---|---|---|---|
| Q1 2022 | 302.63 | (0.2 %) | 1.79 | (70.89) | 373.52 | 2.21 |
| Q2 2022 | 437.47 | (15.7 %) | 2.59 | (39.75) | 477.22 | 2.83 |
| Q3 2022 | 474.79 | 3.4 % | 2.81 | (23.46) | 498.24 | 2.95 |
Profitability
| Period | Gross Margin | OIBDA Margin | Net Margin Before Unusual Items |
|---|---|---|---|
| Q1 2022 | 21.79 % | 22.07 % | 16.04 % |
| Q2 2022 | 18.82 % | 19.12 % | 14.07 % |
| Q3 2022 | 18.60 % | 18.89 % | 13.99 % |
Per Share Data (Riyal)
| Period | Shares Outstanding (M) | EPS (Riyal) | Adjusted EPS (Riyal) | Book Value (BV) |
|---|---|---|---|---|
| Q1 2022 | 168.75 | 8.90 | 9.32 | 26.95 |
| Q2 2022 | 168.75 | 8.42 | 9.07 | 22.98 |
| Q3 2022 | 168.75 | 8.51 | 9.30 | 25.79 |
Multiple Ratios (End of Period Price)
| Period | P/E | Adjusted P/E | Price/book |
|---|---|---|---|
| Q1 2022 | - | - | - |
| Q2 2022 | - | - | - |
| Q3 2022 | - | - | - |
Business Segments (Million)
Q3 2022
| Period | base oil sales | By-products sales |
|---|---|---|
| Q1 2022 | 1,318.78 | 1,421.96 |
| Q2 2022 | 1,643.91 | 1,698.58 |
| Q3 2022 | 1,446.71 | 1,275.11 |
| Current | |
| Market Cap (M Riyal) | 18,393.75 |
| Enterprise Value (EV) (M) | 18,023.65 |
| Shares Outstanding ((M)) | 168.75 |
| EPS ( Riyal) (TTM) | 6.12 |
| Book Value (BV) ( Riyal) | 24.54 |
| Par Value ( Riyal) | 10.00 |
| Adjusted P/E (Last12) | 18.32 |
| P/E (TTM) | 17.82 |
| Price/book | 4.44 |
| Return on Average Assets (%) (TTM) | 11.7 |
| Return on Average Equity (%) (TTM) | 23.5 |
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