Advanced Petrochemical Company’s “Advanced” profits increased by 5.3% to SAR213mn in Q3-2019, compared to SAR202.2mn in Q3-2018. This is due to the low prices of propane and propylene purchased from external sources.
Profit for the nine-month period rose 2.5% to SAR576mn, compared to SAR553mn in the same period last year.
Net profit increased by 5.3% compared to Q3-2018, mainly due to lower prices of propane and propylene purchased from external sources by 41% and 15.6% respectively, and a decrease in consumption of propylene purchased from outside sources by 24.3%.
Despite the decrease in the prices of polypropylene by 13.8%, the increase in propane consumption by 11.9%, and the increase in general and administrative expenses by 47.7%, the net profit improved by 2.5% during the nine-months period, due to an increase in sales volume by 9.3%, and the decrease in propane and propylene prices purchased from external sources increased by 23.4% and 16.1%, respectively, despite a 9.5% decrease in polypropylene prices, a rise in consumption of propane and propylene purchased from outside sources by 7.7% and 4.0%, respectively, higher fixed production costs, overheads, and administrative expenses by 31.6% and 41.8% respectively, and a declining share of profits from investment in SK Advanced Co., Ltd.
Also, the net profit for the Q3-2019 includes SAR25.8mn which is a dividend from investment in SK Advanced Co., Ltd. in South Korea compared to SAR25.4mn for the Q3-2018 and SAR3.1mn for the previous quarter.
Earnings per share have been adjusted for the same period of the previous year due to the increase in the number of shares due to the issuance of bonus shares by 10% upon the approval of the General Assembly on 17 September 2019.
As of 1 January 2019, the Company has adopted IFRS 16 for leases with no material impact on the interim financial statements.