Advanced’s H1 figures beat forecasts, says Al-Mulhim

Advanced Petrochemical Co. reported higher-than-expected figures in H1 2017, chairman Khalifa Al-Mulhim told Argaam, adding that he was optimistic about the company’s profitability over the coming quarters.

The Saudi petrochemicals producer reported a net profit of SAR 319 million in the first half of 2017, a 4.7 percent year-on-year (YoY) drop, driven by lower sales volumes on planned shutdowns of operations in Q1. However, Q2 2017 net profit edged up 0.98 percent YoY to SAR 194 million.

The company is studying the feasibility of several acquisition deals and partnerships in Saudi Arabia and overseas, Al-Mulhim said.

Advanced currently has a strong foothold in Southeast Asia, China and Europe, he noted, adding that the firm is looking to enter African markets.

Commenting on feedstock costs, Al-Mulhim said prices decreased slightly in the second quarter compared to Q1 2017, but did not fall on a YoY basis.

“We hope that prices fall more in the summer,” he said.

Meanwhile, the chairman said that Advanced’s low inventory levels ensure that it is not affected by a decline in product prices.

The company’s stock does not exceed two weeks’ production, which is considered low by industry standards, he added.

"This reflects the improved operating efficiency,” Al-Mulhim said.

Looking ahead, Advanced will not be carrying out any further maintenance at its factories this year, he said, adding that previous maintenance operations have led to higher production and lower cost.