Nama Chemicals currently unlikely to raise capital, liquidate other assets: CEO

Logo of Nama Chemicals

Nama Chemicals Co. is currently not seeking to increase capital, but the option is possible in the future, if necessary or if expansion opportunities are available, CNBC Arabia reported, citing CEO, Abdallah Al-Salem.

The company does not intend to liquidate other assets after exiting Yanbu National Petrochemical Co. (Yansab).

The board of directors decided at the last meeting to carefully study liquid assets until the company repays some of its outstanding commercial loans that will expire soon, Al-Salem said. 

The company will then weigh options in the long term, as market conditions are currently unfavorable for asset liquidation, except for treasury shares that might be liquidated at any time. 

In the coming period, the company's work plan and financial indicators show its ability to fulfill obligations towards the Saudi Industrial Development Fund (SIDF) and other commercial banks, he noted. 

On the company’s continued profitability amid the current product prices, Al-Salem clarified that the significant increase in profitability and retained earnings was due to assets sale; however, the first three quarters of 2021 were already positive at the operational level regardless of the sale of assets. 

In the short- and medium-term, Al-Salem expects prices to be healthy and good to achieve more profits.

Nama Chemicals signed, on Nov. 28, the final agreement to restructure outstanding loans with SIDF, including the total outstanding rescheduled loans worth SAR 451.6 million after payment of Yansab shares sale proceeds of SAR 139.7 million as a prerequisite for developing the final agreement, according to data compiled by Argaam.

The company swung to a net profit after Zakat and tax of SAR 24.4 million for the first nine months of 2021, versus a net loss of SAR 20.6 million in the year-earlier period.