The Saudi Industrial Investment Group (SASE:2250), widely known as SIIG, has successfully returned to profitability during the first half of the fiscal year, driven by robust contributions from its joint ventures. This turnaround was officially reported on Thursday, revealing a net profit of 92 million Saudi riyals for the six months ending June 30.
In stark contrast, the company faced a net loss of 121 million riyals in the same period of the previous year. The earnings per share (EPS) improved to 0.12 riyal, highlighting a significant recovery from the loss of 0.16 riyal per share reported earlier. Significantly, it was the increased quantities sold by SIIG's joint ventures that primarily propelled this profitability.
Despite encountering rising operational costs, the investor experienced an uplift in revenue due to enhanced selling prices and necessary periodic maintenance activities reported by its joint venture firms, which include prominent players such as Saudi Polymer Co, Saudi Chevron Phillips, and Jubail Chevron Phillips. However, SIIG’s fortunes faced challenges in the second quarter, as feedstock and energy costs impacted its profitability.
The net profit nearly halved to 64 million riyals, down from 120 million riyals in the preceding quarter, illuminating the delicate balance SIIG must maintain between increased operational costs and sustaining profit levels. Established in 1995, SIIG stands as one of the pioneering privately owned entities within Saudi Arabia’s petrochemical sector.
Notably, the company employs the equity method for financial reporting, which means it does not publicly disclose revenue or gross profit figures, a strategic choice aligned with its operational framework. As the trading session unfolded on Tadawul, SIIG’s stock reflected a marginal decline of nearly 1%, trading at approximately $20.30, a decrease of $0.10, resulting in a percent change of -0.49%.
Despite these fluctuations, SIIG’s recovery in profits signals a cautiously optimistic outlook for the company moving forward..