SIIG’s Q4 earnings were backed by strong performance of units: MD

Saudi Industrial Investment Group’s (SIIG) Q4 2017 earnings were backed by strong performance of its units, including its 50-percent percent subsidiary National Petrochemical Co. (Petrochem), which alone generated a net profit of SAR 196 million

Petrochem had reported a net profit of SAR 98 million in Q3 2017, managing director, Sulaiman Al Mandeel told Argaam.

“SIIG’s robust figures in Q4 were backed by higher profit shares from subsidiaries and affiliated units,” Al Mandeel said.

SIIG also generated higher profit shares from affiliated Saudi Chevron Phillips (SCP) and Jubail Chevron Phillips (JCP) during the fourth quarter on higher product prices and sold volumes.

During Q4 2017, SIIG cut financing costs provided to the Petrochemical Conversion Co. (PCC) to SAR 2 million from SAR 12 million and then sold PCC for SAR 31 million during the same quarter.

SIIG also slashed the zakat provisions for Petrochem by SAR 65 million (SIIG’s share stood at SAR 32.5 million), generating around SAR 87 million in revenue during the three-month period.

Other details that reflected positively on SIIG’s figures during Q4 included reassessing Petrochem’s subordinated loan at SAR 10 million and generating banking revenue at SAR 8 million as well as FX gains at SAR 4 million.

When asked about the potential merger between SIIG and Petrochem, Al Mandeel said that the merger deal could be feasible upon capitalizing on the integrated synergies.

Commenting on the planned maintenance in JCP and SCP, Al Mandeel said, “We seek to undertake the maintenance process in both projects at the same time, however, stimulants as well as the units’ performance may impact the determined dates.”