SAUDI ARABIA

Aramco posts net income of $68bn for nine months

November 03, 2019
In an undated handout picture provided by Aramco, Saudi Aramco’s Dhahran Research and Development Center is pictured in Saudi Arabia's eastern region of Dhahran. — AFP
In an undated handout picture provided by Aramco, Saudi Aramco’s Dhahran Research and Development Center is pictured in Saudi Arabia's eastern region of Dhahran. — AFP

DHAHRAN — Saudi Aramco announced Sunday its long-awaited stock market debut in what could be the world's biggest IPO, underpinning Crown Prince Muhammad Bin Salman's ambitions to overhaul the Kingdom's oil-reliant economy.

Aramco said it plans to sell an unspecified number of shares on the Riyadh stock exchange, calling it a "historic" milestone for the energy giant which pumps 10 percent of the world's oil.

However, the state firm said there were no current plans for an international listing, indicating that the long-discussed goal for a two-stage IPO including an offering on a foreign bourse had been put aside.

With analysts saying that Aramco could be valued at up to $1.7 trillion, the initial public offering (IPO) is potentially the world's biggest, depending on how much of the company it decides to sell.

"Today marks a significant milestone in the history of the company and important progress towards delivering Saudi Vision 2030, the Kingdom's blueprint for sustained economic diversification and growth," Aramco chairman Yasir Al-Rumayyan said.

The final offer price and the number of shares to be sold "will be determined at the end of the book-building period," said the firm, which is headquartered in the eastern city of Dhahran.

Aramco had initially been expected to sell a total of five percent on two exchanges, with a first listing of two percent on the Tadawul Saudi bourse followed by a three percent listing on an overseas exchange.

"For the (international) listing part, we will let you know in due course. So far it's only on Tadawul," he told a press conference. However, the company said the Riyadh offering was open to institutional investors as well as Saudi individuals, foreigners resident in the Kingdom and other Gulf citizens.

The company also released its results for the nine months to September, saying net profits came in at $68 billion. Aramco only began releasing interim financial results recently.

Its 2018 net profit of $111.1 billion is higher than the profits of Apple, Google and Exxon Mobil combined.

The company's revenues and other income related to sales stood at $244 billion for the same period, Saudi Aramco said. Capital expenditure during the period stood at $23 billion, while free cash flow was $59 billion, it said.

Saudi Aramco also said it does not expect the Sept. 14 attacks "to have a material impact on its business, financial condition or results of operation." — AFP


November 03, 2019
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