SearchBusiness Segment Performance
Efforts to contain costs, optimize working capital, and allocate capital efficiently have helped maintain a strong cash flow position.
In 2023, the revenue of the Petrochemicals segment was SAR 131.26 Bn. (US$ 35.00 Bn.), representing a decrease of 20% compared to 2022; similarly, the EBITDA of SAR 14.62 Bn. (US$ 3.90 Bn.) in 2023 decreased by 42% against SAR 25.10 Bn. (US$ 6.69 Bn.) in 2022. These decreases were largely driven by an 18% lower average selling price versus last year.
Within the Petrochemicals segment:
- Chemicals: Methyl tertiary-butyl ether global prices decreased by 8% compared with the previous year, following the lower oil prices. MEG global prices decreased by 15% compared with the previous year, driven by overcapacity.
- Polymers: PE and PP global prices were lower by 22% and 23%, compared with the previous year, driven by weak demand and overcapacity. PC global prices were lower by 22%, compared with the previous year, driven mainly by weak demand globally.
For Agri-Nutrients, the revenue decreased to SAR 10.28 Bn. (US$ 2.74 Bn.) on 2023 from SAR 18.23 Bn. (US$ 4.86 Bn.) in 2022. EBITDA decreased to SAR 4.40 Bn. (US$ 1.17 Bn.) in 2023 from SAR 11.30 Bn. (US$ 3.01 Bn.) in 2022. These decreases were largely driven by a 43% lower average selling price versus last year.
A WORD OF GRATITUDE AND FAREWELL TO HADEED
Hadeed has been a key contributor to SABIC’s success and value creation. As we have both grown, however, we realize that organizational separation will create benefits for both companies, given that petrochemicals and metals segments serve distinct markets with different dynamics.
The Public Investment Fund (PIF) signed a share purchase agreement to acquire a 100% shareholding in the Saudi Iron & Steel Company (Hadeed) from SABIC, a cross-conditional share exchange agreement, that will allow Hadeed to acquire a 100% shareholding in Al Rajhi Steel Industries Company. The transactions are part of PIF’s broader efforts to accelerate Saudi Arabia’s industrial development, contributing towards the growth of key downstream sectors, such as local construction, automotive, utilities, renewables, transport, and logistics, in line with Saudi Vision 2030. The deal was announced on September 3, 2023, and the enterprise value of the transaction is SAR 12.5 Bn. (US$ 3.3 Bn.). The transaction is subject to customary conditions and regulatory approvals. It is expected to be closed before the end of the second quarter of 2024.
Separation will enable both businesses to allocate resources more accurately, become more agile in responding to shifts in their respective industry landscapes and customers’ needs, and increase operational efficiencies and speed. Ultimately, the strategic clarity created by this separation will make SABIC and Hadeed more competitive and dynamic, setting them on a new course of growth.
Read a detail review of the performance of our business segments.
BUSINESS SEGMENT REVIEW
Financial metrics
Petrochemicals (Chemicals and Polymers) and Specialties
-
Revenue
2023: SAR 131.26 Bn. (US$ 35 Bn.)
2022: SAR 164.85 Bn. (US$ 43.96 Bn.)
-
EBITDA
2023: SAR 14.62 Bn. (US$ 3.90 Bn.)
2022: SAR 25.08 Bn. (US$ 6.69 Bn.)
-
Income from operations (EBIT)
2023: SAR 0.20 Bn.
(US$ 0.05 Bn.)2022: SAR 12.45 Bn.
(US$ 3.32 Bn.)
Agri-Nutrients
-
Revenue
2023: SAR 10.28 Bn. (US$ 2.74 Bn.)
2022: SAR 18.23 Bn.
(US$ 4.86 Bn.) -
EBITDA
2023: SAR 4.4 Bn.
(US$ 1.17 Bn.)2022: SAR 11.30 Bn.
(US$ 3.01 Bn.) -
Income from operations (EBIT)
2023: SAR 3.52 Bn.
(US$ 0.94 Bn.)2022: SAR 10.46 Bn.
(US$ 2.79 Bn.)
OPERATIONAL METRICS
Petrochemicals: Polymers
| Mn. t |
|
2023 | 2022 | Change % |
|---|---|---|---|---|
| Production volumes | 9.1 | 10.3 | -11 | |
| Sales volumes | 15.5 | 16.2 | -4 |
Petrochemicals: Chemicals
| Mn. t |
|
2023 | 2022 | Change % |
|---|---|---|---|---|
| Production volumes | 36.2 | 37.6 | -4 | |
| Sales volumes | 23.4 | 23.5 | 0 |
Specialties
| Kt |
|
2023 | 2022 | Change % |
|---|---|---|---|---|
| Production volumes | 53 | 67 | -21 | |
| Sales volumes | 218 | 277 | -21 |
Agri-Nutrients
| Mn. t |
|
2023 | 2022 | Change % |
|---|---|---|---|---|
| Production volumes | 8.1 | 8.3 | -2 | |
| Sales volumes | 6.7 | 6.7 | 0 |
Disclaimer: This abridged interactive version of the SABIC Integrated Annual Report 2023 is based on the original PDF report published on this website. In case of any discrepancy, the original PDF report will prevail.