Borouge, the joint venture between Adnoc and Austrian chemicals producer Borealis, reported an annual drop of about 7 per cent in its third-quarter profit due to lower revenue.
Net profit attributable to shareholders of the company fell to $279.09 million in the three months that ended on September 30, the company said in a filing to the Abu Dhabi Securities Exchange, where its shares are traded.
Revenue during the period fell by about 11 per cent to about $1.5 billion.
However, on a quarter-to-quarter basis, Borouge recorded a 22 per cent increase in its net profit and a 6 per cent gain in its revenue.
“Borouge has delivered robust operating and financial performance this quarter, leveraging the company’s competitive advantages,” said its chief executive Hazeem Al Suwaidi.
“Consequently, sales volumes have grown and we remain committed to innovation to expand market share and maintain strong pricing premia.”
Borouge, which has announced a dividend of $1.3 billion for 2023, said it distributed an interim dividend of $650 million in the third quarter.
The company said that pressure linked to market weakness was partially offset by the positive impact of the value-enhancement programme, as well as by healthy sales volumes.
Borouge’s value enhancement plan delivered a $420 million “positive impact” in the first nine months of 2023, exceeding its target of $400 million.
It has now further raised the programme’s target to $500 million.
The company’s sales volume grew by more than 4 per cent to about 1.4 million tonnes in the third quarter. In the first nine months, sales volume rose 2 per cent to 3.76 million tonnes.
In May last year, Borouge raised $2 billion through an initial public offering and was listed on the ADX. The IPO, which was about 42 times oversubscribed, was the largest listing in Abu Dhabi at the time.
After its listing, Borouge was included in the FTSE Global Equity Index Series, which is used by investors globally to guide asset-allocation decisions and support portfolio construction.
This month, Borouge and Austrian chemicals producer Borealis signed an initial agreement with Abu Dhabi Waste Management, better known as Tadweer, to explore recycling opportunities In Abu Dhabi.
“The overall polyolefins market remains challenging, with pricing expected to operate within a narrow band of volatility throughout the fourth quarter of 2023,” the company said.
“Borouge remains well-positioned to deliver product premia versus benchmarks through-the-cycle given the company’s competitive and cost-advantaged feedstock position.”
Polypropylene, Borouge’s main product, is a thermoplastic material used in products such as plastic packaging, car parts and textiles.
The global polypropylene market is projected to hit $167 billion by 2029, from about $121 billion in 2021, growing by 4.2 per cent annually during the forecast period of 2022 to 2029, according to Data Bridge Market Research.
The UAE plans to triple its petrochemical production capacity from 4.5 million tonnes – currently produced entirely by Borouge – by 2025.