Saudi Aramco reported a 25% fall in first-quarter net profit after oil prices tumbled
DUBAI - Saudi Aramco, the world’s top oil exporting company, on Tuesday reported a 25% fall in first-quarter net profit, missing analyst estimates, but its quarterly dividend was in line with a plan for a $75 billion payout for the year.
Despite the drop in profit, the state oil giant's cashflow remained strong compared to other oil majors, reflecting its strong balance sheet and resilience.Shares of Aramco were up 1.3% at 31.30 riyals at 0825 GMT, still trading below the IPO price of 32 riyals. Aramco’s net profit fell to 62.48 billion riyals after zakat and tax for the quarter to March 31 from 83.29 billion riyals a year earlier, below estimates by analysts who expected a profit of $17.8 billion.
“They will cut the share of the government in the second quarter but there is some upside if they renegotiate the SABIC deal which could save them some cashflow,” he said. Aramco had kept its oil output at around 9.8 million barrels per day during the first three months of the year under the OPEC+ supply cut pact, before opening the oil taps in April after the collapse of earlier supply cut talks in early March.
Aramco said its results reflected lower oil prices, declining refining and chemicals margins and “inventory re-measurement losses”. “We continue to reinforce the business during this period by reducing our capex and driving operational excellence. Longer term we remain confident that demand for energy will rebound as global economies recover.”
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