Saudi Aramco posted a year-on-year (YoY) drop in Q1 2023 net profit to $31.9 billion from $39.5 billion as lower demand for oil pressured prices, but said it plans to move ahead with capacity expansion.

The profit beat analysts’ mean estimate of $30.84 billion, according to data compiled by Refinitiv’s Eikon.

In a regulatory filing on Tadawul on Tuesday, the integrated oil and gas company declared a cash dividend of $19.5 billion for Q4 2022, representing a 4% increase from the previous quarter.

Q1 2023 dividend of $19.5 billion will be to be paid in Q2, it said, adding the company plans to introduce a mechanism for performance-linked dividends in addition to the base dividend.

Chief Executive Officer (CEO) Amin Nasser said: “We are also moving forward with our capacity expansion, and our long-term outlook remains unchanged as we believe oil and gas will remain critical components of the global energy mix for the foreseeable future.”

He said Aramco’s intention is to continue to be a reliable energy supplier with the ability to provide more sustainable energy solutions, supporting efforts to achieve an orderly energy transition.

“By working to further reduce the carbon footprint of our operations and adding new lower-carbon energy options to our portfolio, I am confident about the contributions we will make.”

Capital expenditure for Q1 came in at $8.74 billion compared with a capex of $7.58 in the year-ago period.

Free cash flow was higher YoY at $30.89 billion, according to the company.