Saudi Petrochemical Companies Cut Losses by More Than 50% in H1

RIYADH: Net losses at nine petrochemical companies listed on the Saudi Exchange fell by more than 50 percent in the first half of 2026 to SR1.7 billion ($452.8 million), from about SR3.4 billion ($908.5 million) a year earlier.

The improvement reflected stronger operating efficiency, better results from some associates and joint ventures, and lower losses from discontinued operations and asset impairments. Companies also faced pressure from weaker returns on equity investments, higher average costs for some production inputs and lower sales volumes due to supply-chain disruptions.

Four companies posted net profits — SABIC Agri-Nutrients, Yansab, Saudi Industrial Investment Group and Alujain — while Advanced Petrochemical, Sipchem, SABIC, Tasnee and Saudi Kayan reported losses.

SABIC Agri-Nutrients posted the sector’s highest profit at about SR1.6 billion, down 21.4 percent from SR2.04 billion a year earlier. The company attributed the decline to lower sales volumes caused by supply-chain challenges and weaker results from an associate and a joint venture, partly offset by higher average selling prices for most products.

Yansab ranked second, with profit surging 363 percent to SR270 million from SR58.2 million, supported by higher selling prices and strong plant reliability. Saudi Industrial Investment Group’s profit rose 410 percent to SR194 million.

Saudi Kayan recorded the largest loss at SR1.29 billion, compared with SR1.27 billion a year earlier. Tasnee lost SR889.1 million and SABIC reported a loss of SR820 million.

Combined second-quarter losses for the nine companies fell 42.17 percent to SR2.07 billion from SR3.58 billion a year earlier.

G. World CEO Mohamed Hamdy Omar told Asharq Al-Awsat that performance varied according to product mix, petrochemical feedstock costs, production and sales volumes, operating efficiency and exposure to global markets and supply-chain disruptions.

He noted that SABIC’s losses narrowed sharply from SR4.07 billion to SR833 million, but said much of the improvement reflected the non-recurrence of provisions and impairment charges rather than an equivalent recovery in underlying operations.

SABIC Agri-Nutrients, meanwhile, remained among the sector’s most profitable companies, although second-quarter profit fell 64.2 percent to SR379 million because of lower sales volumes, supply-chain disruptions and weaker contributions from an associate and joint venture.

Omar expects a gradual but uneven recovery in the second half, with global demand, feedstock and energy costs, excess capacity, shipping disruptions and geopolitical tensions remaining key factors. He said sustainable improvements in operating margins, sales volumes and cash flow would provide the clearest evidence of a genuine sector recovery.