SABIC posts 499 million riyals in profit despite lower revenue, as associate results improve by 1.62 billion riyals
Key Facts
Saudi Basic Industries Corp. (SABIC) reported net profit of 499 million riyals in the third quarter on October 25, 2026, compared with 434 million riyals in the same period a year earlier. The result came as annual revenue fell to 28.17 billion riyals from 29.08 billion riyals, despite rising 14% quarter on quarter. The company said adjusted earnings before interest, taxes, depreciation and amortization reached 4.75 billion riyals, up 40% from the second quarter, while adjusted operating profit rose 434% to 2.17 billion riyals. Adjusted net income also returned to 840 million riyals, after an adjusted loss of 380 million riyals in the second quarter. These measures reflect a quarter-on-quarter improvement in performance, while reported net profit was above its year-earlier level despite lower annual revenue.
One of the most notable differences in the period’s results was a 1.62 billion riyal improvement in results from associates and joint ventures compared with the same period a year earlier. Dow Jones coverage via MarketScreener attributed much of the improvement to the reversal of an impairment of SABIC’s investment in Swiss chemicals company Clariant. This figure relates to the improvement in results from associates and joint ventures and does not itself represent a separate gain realized during the quarter. The accounting reversal should therefore be separated from operating indicators when assessing the increase in net profit. By contrast, the coverage said a 916 million riyal increase in selling and distribution expenses partly offset the improvement, as supply chain disruptions continued.
Quarter on quarter, revenue rose to 28.17 billion riyals after falling 5% to 24.81 billion riyals in the second quarter. Adjusted earnings before interest, taxes, depreciation and amortization also rose to 4.75 billion riyals from 3.38 billion riyals in the second quarter. SABIC said a 30% increase in sales volumes compared with the previous quarter supported performance despite a decline in average selling prices. The company added that sales volumes rose across its businesses, and that shipments through the Strait of Hormuz and the use of western ports helped it manage logistical challenges. It said improved margins were also linked to lower liquid feedstock costs, providing operating support alongside sales growth.
Regional shipping disruptions continued to weigh on the sector’s activity. Dow Jones coverage said the disruptions affected SABIC’s sales volumes, hampered chemical exports through the Strait of Hormuz and forced Gulf producers to seek alternative routes. In its statement, SABIC said its response to logistical challenges included “successful shipments through the Strait of Hormuz and the use of western ports.” Those efforts did not prevent selling and distribution expenses from rising, adding 916 million riyals to costs during the quarter. These pressures put the improvement in sales volumes and margins in an operating context where transportation costs intersect with export routes.
On its financial position, net debt stood at 3.03 billion riyals on September 30, 2026, compared with 2.73 billion riyals on June 30. This came alongside adjusted net income returning to profit in the third quarter after an adjusted loss in the second quarter. SABIC said expected capital expenditure for fiscal 2026 was between 3 and 3.3 billion dollars. Chief Executive Faisal Al-Faqeer said the company remained focused on portfolio optimization, transformation and selective growth, “to support the company’s long-term profitability and create value for shareholders.” The company links these priorities to its goal of strengthening long-term profitability, while net debt and capital expenditure remain among the indicators disclosed in its results.
SABIC shares closed at 43 riyals on October 25, 2026. The company is scheduled to hold a call to discuss its third-quarter results on October 26 at 3:30 p.m. Saudi time. The call follows the results announcement by one day, according to the schedule the company published for investors. Topics SABIC highlighted in its period results include quarter-on-quarter revenue growth, higher adjusted earnings measures and the annual capital expenditure range. The company also identified portfolio optimization, transformation and selective growth among its stated objectives for the next phase.