17 July 2013 11:58 [Source: ICIS news]
DUBAI (ICIS)--Saudi International Petrochemical Co (Sipchem) reported on Wednesday a 28% increase in second-quarter net profit to Saudi riyal (SR) 174.0m ($46.4m), citing improved sales.
“Increase in profits as a result of increase in sales in addition to improvements in plants performance after the planned turnaround during first quarter,” Sipchem said in a bourse statement.
The company, which is in talks with Sahara Petrochemicals on a potential merger, said its first six months net profit fell 17% from a year ago.
It made SR238.5m in the first six months, compared with SR287.7m profit generated in the same period a year ago.
Sipchem said the fall in net income over the first half of the last year was due to production cuts that resulted in low sales volumes.
The company said the planned turnaround activities that were completed successfully during the first quarter have contributed to increased production and improved operating performance and efficiency of the company.
“It will also reflect positively on the remaining quarters,” it added.
In June, Sipchem and Sahara Petrochemicals have started a joint feasibility study on a potential merger. The companies will undergo technical, financial, and regulatory studies over the next five months.
Sipchem has picked HSBC Holdings to advise on the proposed merger.
A tie-up between the two would give the combined entity a greater product range, as Sahara produces basic petrochemicals and Sipchem focuses more on high-value product.
($1 = SR3.75)
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