Arab News, Sunday, Aug 14, 2022 | Muharram 16, 1444
Oil behemoth Aramco beats forecasts with record Q2 profit of $48.4bn
Saudi Arabia: Saudi Aramco’s profit
has surged 90 percent in the second quarter of 2022, beating the median of
analysts’ forecasts with the highest quarterly profit since going public in
2019.
The oil giant was expected to report $46.2 billion
in net income based on 15 analyst forecasts.
Profits of “the most profitable oil company in the
world” hit SR182 billion ($48.4 billion) after revenue soared 80 percent to
SR562 billion, according to a bourse filing.
This is up from SR148 billion in the prior quarter
and SR95.5 billion in the second quarter of 2021.
The crude producer said the results were primarily
driven by rising crude prices which soared to record highs earlier this year,
higher volumes sold, and improved downstream margins.
“Our record second-quarter results reflect
increasing demand for our products — particularly as a low-cost producer with
one of the lowest upstream carbon intensities in the industry,” said CEO, Amin
Nasser, commenting on the results.
“While global market volatility and economic
uncertainty remain, events during the first half of this year support our view
that ongoing investment in our industry is essential — both to help ensure
markets remain well supplied and to facilitate an orderly energy transition,” he
added.
Further to the solid results, Aramco maintained
stable quarterly dividends at SR70.3 billion, representing a per-share payout of
SR0.3198 to be paid on Sept. 7.
Capital expenditure during the quarter grew 25
percent to $9.4 billion as Aramco continued to invest and capture growth
opportunities.
In terms of half-year performance, Aramco
outperformed with an 86 percent profit surge to SR330 billion from SR177 billion
a year earlier.
The Saudi-listed company almost doubled its
revenue to SR1.03 trillion, compared to SR584 billion in the first half of 2021.
Buoyed by higher operating cash flow, Aramco
managed to strengthen its balance sheet with a gearing ratio of 7.9 percent at
June end, compared to 14.2 percent at the end of 2021.
“We expect oil demand to continue to grow for the
rest of the decade, despite downward economic pressures on short-term global
forecasts,” Nasser said.
“But while there is a very real and present need
to safeguard the security of energy supplies, climate goals remain critical,
which is why Aramco is working to increase production from multiple energy
sources — including oil and gas, as well as renewables, and blue hydrogen.”
Recent highlights:
Aramco and Cognite, a global leader in industrial
software, announced the launch of CNTXT, a joint venture based in the Kingdom,
which will be headquartered in Riyadh. CNTXT will support industrial
digitalization in Saudi Arabia and the wider Middle East and North Africa
region.
Aramco was reported to weigh an initial public
offering of its unit Aramco Trading Co. that could potentially raise over $30
billion, slated to become one of the world’s biggest listings this year.
Aramco joined hands with Thailand's national
oil company PTT, as it expands its footprints in Asia. Both companies will work
together in areas of blue and green hydrogen and various clean energy
initiatives.
Aramco acquired US-based Valvoline Inc.’s
global products unit in a $2.65 billion deal.