Saudi fertiliser firm sees 125% Q2 profit jump

Saudi Arabian Fertilizers Co (SAFCO) beat forecasts with a near-125 percent rise in second-quarter profit, setting the scene for the earnings of parent firm Saudi Basic Industries Corp. (SABIC).

SAFCO, which is 42 percent owned by SABIC, made a profit of 1.19 billion riyals ($317.6 million) in the three months ending June 30 up from 530.3 million riyals a year earlier, it said in a statement on the bourse website.

The increase came on the back of "improvement in the selling price of core products and the volume of sales", it said.

Analysts' forecasts for SAFCO's second-quarter profit ranged from 928.4 million riyals to 1.06 billion riyals, according to a Reuters survey last month.

SAFCO expanded capacity at a project in the second quarter of last year, it said in January.

Both a global surge in food prices and demographic growth have led to a surge in demand for fertilisers, analysts say.

For the six months to June 30, net profit rose 7.66 riyals per share, against 4.25 riyals per share a year earlier, SAFCO said.

Operating profit for the first half reached around 1.7 billion riyals, up 107 percent from the same period in 2007.

Analysts forecasts for second-quarter profit of SABIC, the world's largest chemical firm by market value, range from 7.16 billion riyals to 7.63 billion riyals. (Reuters)

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