SABIC affiliate beats analyst forecasts but rues low urea prices for drop in income
Saudi Arabian Fertiliser Company (Safco) reported a 5.1 percent fall in third-quarter net profits on Saturday, beating analyst forecasts, but citing low urea prices for the drop in income.
The affiliate of Saudi Basic Industries Corp (SABIC) , the world's biggest petrochemical company by market value, said in a bourse statement it made net income of SAR1.15bn (US$306m) in the three months to September 30.
The result was a 47 percent increase on the second quarter of this year, when production was cut by a plant shut down.
Eleven analysts polled by Reuters had forecast profit of, on average, SAR985m.
"The decrease in 3Q net income against 2011 3Q net income was due to the decrease of the average price of urea product," Safco said in a statement, adding that production and sales volumes had however increased.
The company said the quarter's gross income had fallen by 1.8 percent on the year.
Another Sabic unit, Yansab, earlier on Saturday reported its quarterly net profits had almost halved from third-quarter 2011 figures.
Higher food prices this year caused by bad weather in important growing countries might raise demand for fertiliser in coming months, analysts have said.For all the latest industry news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.