Saudi Basic Industries Corp (SABIC), one of the world’s biggest petrochemical companies, on Thursday posted an almost 17 per cent fall in third-quarter revenue and a net loss.

In a filing, SABIC reported a net loss of 2.88 billion riyals ($768m) for the three months to September 30, compared with a profit of SAR1.84bn a year earlier.

The loss was mainly driven by an impairment charge of SAR2.93bn on the fair value of Saudi Iron and Steel Company (Hadeed) after Saudi Arabia’s sovereign wealth fund acquired SABIC’s entire stake in the company.

SABIC’s divestment in Hadeed was agreed to in September, allowing the Saudi petrochemicals giant to “optimise its strategic portfolio and focus on its core business,” it said.

SABIC posts drop in revenue

Revenues fell to SAR35.98bn from SAR43.32bn a year earlier, but was up almost 6 per cent quarter-on-quarter.

The global petrochemical market continues to witness weak global demand and an increase in supply for most products, SABIC said.

Its average selling price fell 5 per cent quarter-on-quarter while prices for agri-nutrient products increased by 11 per cent.

The company said it remains disciplined in managing its capital expenditure which for 2023 it estimates at $3.5bn to $3.8bn.

Chemical makers had flagged a potential blow in the second half of the year from a slower-than-expected recovery in China following its post-pandemic reopening and lower demand in Europe.

Shares of SABIC have declined almost 15 per cent this year.