In this report, Argaam highlights the expected results of Saudi Aramco Base Oil Co. (Luberef) in Q3 2024, in addition to the company’s key events, quarterly revenue and profit development, as well as performance and profitability indicators.
The third-quarter revenue is expected to fall 1.8% year-on-year (YoY) to SAR 2.5 billion.
| Item | Q3 2023 |
Q4 2023 |
Q1 2024 |
Q2 2024 |
Q3 2024 (Average Estimate) |
|---|---|---|---|---|---|
| Sales | 2,549.34 | 2,529.57 | 2,184.79 | 2,728.81 | 2,503.75 |
| Change % | (6.34%) | 39.85% | 21.60% | 4.43% | (1.79%) |
| Item | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 (Average Estimate) |
|---|---|---|---|---|---|
| Net Income | 340.43 | 268.65 | 239.01 | 298.84 | 261.31 |
| Extraordinary income/expense | 21.84 | 12.46 | 0.00 | 5.64 | - |
| Net Profit Before Unusual Items | 318.59 | 256.19 | 239.01 | 293.21 | - |
| EPS Before Unusual Items (Riyal/Share) | 1.89 | 1.52 | 1.42 | 1.74 | 1.55 |
Key Events in Q3 2024
- The company’s board of directors decided to distribute cash dividends to shareholders at 36% (equivalent to SAR 3.6 per share) for the first half of 2024.
- On Nov. 3, Luberef will announce its financial results for Q3 2024.
- The average prices of Group I and II base oils increased 14% and 1.8% YoY, respectively, in Q3 2024, while the average prices of Group III base oils decreased by 16.3% YoY.
Compared to Q2 2024, the average prices of Group I and II base oils retreated by 2.9% and 6.9% QoQ, respectively, while the average prices of Group III grew by 2.5% QoQ, as shown in the following table:
|
Average Prices of Base Oils for Three Groups ($/metric ton) |
|||||
|
Item |
2023 |
2024 |
|||
|
Q3 |
Q4 |
Q1 |
Q2 |
Q3 |
|
|
Group I |
805.4 |
905.4 |
919.4 |
945.3 |
917.8 |
|
Group II |
841.5 |
892 |
836.2 |
920.4 |
856.5 |
|
Group III |
1315.8 |
1174 |
1066.5 |
1074.6 |
1101.3 |
Average Estimates
Luberef is expected to log a net profit of SAR 261.3 million in Q3 2024, a YoY decline of 18%, according to average estimates by four research firms.
| Analyst | Million Riyals |
|---|---|
| Citi Bank Group | 272.22 |
| Al Rajhi Capital Company | 267.00 |
| GIB Capital LLC | 262.00 |
| SNB Capital Company | 244.00 |
| Average | 261.31 |
| Net Profit Before Unusual Items (2023 - Q3) | 318.59 |
| Change % | (17.98%) |
Performance & Profitability Indicators
The following table shows the stock performance, P/E ratio, and earnings per share trailing 12 months (TTM) and year to date (YTD):
| Item | The Company | TASI |
|---|---|---|
| YTD | (9.66 %) | (0.12 %) |
| Change(12M) | (36.88 %) | 12.46 % |
| Previous Close | 117.20 | 12,022.11 |
| P/E adjusted (x) | 17.78 | 25.43 |
| EPS (TTM) before unusual items (SAR/Share) | 6.56 | - |
| P/E (TTM) | 17.53 |
| P/E Before Unusual Items (TTM) | 17.87 |
| P/BV | 3.88 |
| Dividend Yield | 5.96 % |
| Market Cap. (M) | 17,043.75 |
| Return on Average Assets | 11.71 % |
| Return on Average Equity | 20.98 % |
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