SABIC, the Saudi chemical giant, will lose $6.9 billion in 2025 due to asset sales

SABIC, the Saudi chemical giant, reported on Wednesday that it would suffer a "massive" net loss by 2025. This was mainly because of impairments and losses relating to divestment assets in Europe and America.

Chemicals industry is struggling with overcapacity. This has led to squeezed margins, and a decline in utilization rates.

In a filing to the bourse, it said that its 2025 loss would be 25.78 billion (or $6.87 billion). This compares to a net profit of 1.54 billion in 2015. The full-year revenue dropped 1%, to 116.53 billion riyals due to lower average selling price.

The divestments form part of a major strategic shift that aims to eliminate "structurally-disadvantaged" assets from Europe and the Americas in order to increase?financial return amid persistent global overcapacity.

The assets?being?sold include the?European petrochemicals?business to private equity company AEQUITA, and its engineering thermoplastics?business in the Americas & Europe to Mutares.

SABIC, which owns 70% of the state oil giant Saudi Aramco reported adjusted net earnings of $550 millions for 2025. This is down from adjusted net profits of $1.57 billion during 2024.

SABIC said that its adjusted net income reflects the performance of the company's operations based on the "normal course of business" by eliminating?the effects of non-operational anomalies, one-offs, and discontinuing operation.

The company plans to invest between $3.5 billion and $4 billion by 2026 as it refocuses on cost-advantaged value chains and regions.

SABIC's free cash flow in 2025 was 7.2 billion riyals, an increase of 17% over 2024. This was a result of reduced capital expenditures by $380 million and a more efficient working capital. The company also announced total dividends worth 9 billion riyals. $1 = 3.7527 Riyals (Reporting and editing by Clarence Fernandez; Yousef Saba)

(source: Reuters)