Crude Oil Pipelines Stand at the US Department of Energy (Photographer: Luke Sharrett/Bloomberg)

Saudi Petrochemicals Giant Posts 81% Gain in Quarterly Profit

(Bloomberg) -- Saudi Basic Industries Corp., the Middle East’s biggest petrochemicals producer, posted an 81 percent increase in second-quarter profit on higher sales prices and volumes.

Net income rose to 6.7 billion riyals ($1.8 billion) from 3.71 billion riyals a year ago, the company known as Sabic said in a statement. Revenue climbed 26 percent to 43.3 billion riyals. The company said it put into effect a “strategic restructuring initiative” that cut total costs by 1.1 billion riyals.

State-owned Saudi Aramco said earlier this month it may buy shares in Sabic from the country’s sovereign wealth fund as the world’s biggest crude oil exporter expands ahead of a planned initial public offering. Aramco has no plans to acquire any publicly held shares in Sabic, it said.

Sabic Chief Executive Officer Yousef Abdullah Al Benyan declined to comment on the size or timing of a possible stake purchase by Aramco, when asked about it on Sunday at a news conference in Riyadh. He also declined to comment on Aramco’s possible decision to tap the international bond market for the first time to finance the acquisition of a stake in his company.

Sabic expects to secure antitrust approval by the end of the third quarter to buy a stake in Switzerland-based chemicals company Clariant AG, Al Benyan said. Sabic agreed in January to acquire a 24.99 percent of Clariant from White Tale Holdings.

Sabic shares have gained 27 percent this year, helped by MSCI Inc.’s announcement last month that it will include Saudi Arabia in its emerging-market index next year. That compares with 16 percent gain for the benchmark Tadawul All Share Index. The company’s shares were 0.3 percent lower at 129.40 riyals at 11:08 a.m. in Riyadh.

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