Saudi Aramco profit slumps 44% after Covid-battered year, but maintains dividend

Environment

A worker at an oil processing facility of Saudi Aramco, a Saudi Arabian state-owned oil and gas company, at the Abqaiq oil field.
Stanislav Krasilnikov | TASS | Getty Images

Oil giant Saudi Aramco reported a 44% slump in full-year 2020 results, but maintained its $75 billion dollar dividend payout, with CEO Amin Nasser describing the last twelve months as one of the most “challenging years” in recent history. 

Saudi Aramco, Saudi Arabia’s behemoth state oil firm, reported net income of $49 billion in 2020, down from $88.19 billion in 2019. The result was slightly below analysts expectations of $48.1 billion but still represents the highest of any public company globally. 

“In one of the most challenging years in recent history, Aramco demonstrated its unique value proposition through its considerable financial and operational agility,” Saudi Aramco Chief Executive Amin Nasser said in company statement Sunday.

Aramco said revenues were impacted by lower crude oil prices and volumes sold, and weakened refining and chemicals margins. 

The firm also said it expects to cut capital expenditure in the year ahead, and lowered its guidance for spending to around $35 billion from a range of $40 billion to $45 billion previously. 

Free cash flow slumped almost 40% to $49 billion, well below the level of its hotly anticipated dividend. Aramco also declared a payout of $75 billion for 2020, despite concern that it would take on additional debt to maintain it.

“Looking ahead, our long-term strategy to optimize our oil and gas portfolio is on track and, as the macro environment improves, we are seeing a pick-up in demand in Asia and also positive signs elsewhere,” he added.

Shares in the top western oil and gas companies including Royal Dutch Shell and BP dropped to multi-year lows in 2020, as the coronavirus pandemic wrecked havoc across the global economy and sparked a historic collapse in the price of oil. Exxon Mobil, the largest U.S. energy company, posted its first annual loss.

Articles You May Like

Putin rails against Western ‘dictatorship’ as he declares four Ukrainian regions as Russian
Weird Alibaba: Anyone want a $2,000 school bus-shaped electric food truck from China?
Truss admits ‘disruption’ to UK economy but stands by forecast-free mini-budget
Liz Truss and Tories’ approval ratings take another hit in fresh poll
NHL Future Power Rankings: Predicting best, worst teams for the next three seasons