Borouge announced a 13.5 percent increase in revenue to $5.13 billion (AED18.84 billion) for the first nine months of the year and the company reiterates its commitment to pay $975 million in dividends to shareholders for the financial year 2022, and at least $1.3 billion for 2023.
The Abu Dhabi-based polyolefins manufacturer maintained positive year-to-date performance driven by strong sales volumes. The increase in revenue over the nine months was driven by an 11.9 percent increase in total sales volumes, with polypropylene (PP) volumes up 14.7 percent.
The new PP5 plant commenced production of more differentiated and premium grades in the third quarter and that led to overall production capacity growing by 7.9 percent on a year-on-year basis.
Borouge also confirmed its mid-term guidance on premia of $200/tonne for PE and $140/tonne for PP. Sales volumes are expected to return to levels equivalent to production volumes through the current quarter, with demand in its core Asia and Middle East markets expected to outperform global developed markets.
The company’s strong volume growth partially offset the decline in its average selling prices, which were impacted by global supply and pricing pressures. Its pricing premia remained higher than its medium-term guidance – a key competitive advantage for the business.
In October 2022, Borouge paid an interim dividend of $325 million (AED1.2 billion) or 3.97 fils per share. Based on the current view, the company remains confident it will meet market expectations for net profit for FY 2022.
Hazeem Sultan Al Suwaidi, Chief Executive Officer of Borouge, commented: “We are pleased to report our third quarter and nine-month results, with strong year-to-date performance for revenue and sales volume delivered across our business.
“We have achieved this despite global supply and pricing pressures. These results demonstrate our ability to continually innovate, providing a broader product mix to industries and customers worldwide.
“Our infrastructure solutions continue to grow their share of our end-product market, accounting for 46 percent in the third quarter and remain a priority as we differentiate our offering from global peers. Importantly, we have been able to maintain our premia above benchmark pricing in the market, which is a testament to the efficiency of our operations and the quality of the products we offer.”
Adjusted EBITDA declined by 3.6 percent to $2.10 billion due to globally elevated logistics and material costs. However, Borouge saw a slight reduction in these costs towards the end of the third quarter.
For the third quarter ending 30th September 2022, revenue increased by 8 percent year-on-year to $1.67 billion. Total sales volume in the three months increased by 18.1 percent year-on-year to 1,341kt.
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