Saudi Aramco profits dive

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Riyadh: Energy giant Saudi Aramco on Tuesday posted a 44.6 percent slump in third-quarter profit, as the coronavirus pandemic weighs heavily on the global demand for crude oil.

Aramco, seen as Saudi Arabia’s cash cow, has revealed consecutive falls in quarterly profits since it began disclosing earnings last year, piling pressure on government finances as it pursues ambitious multi-billion dollar projects to diversify the oil-reliant economy.

The world’s most valuable listed company said it was committed to a bumper dividend even as third quarter net profits dropped to 44.21 billion Saudi riyals ($11.79 billion), compared to $21.3 billion in the same period last year.

Aramco’s net profit for the first nine months of this year also dropped 48.6 percent to $35.02 billion, the company said.

Although the results underscore a downbeat market, Aramco’s July-September results showed an improvement amid relatively steady crude prices compared to the second quarter, when it posted a profit of $6.57 billion.

“We saw early signs of a recovery in the third quarter due to improved economic activity, despite the headwinds facing global energy markets,” Aramco’s chief executive Amin Nasser said in the statement.

“We continue to adopt a disciplined and flexible approach to capital allocation in the face of market volatility. We are confident in Aramco’s ability to manage through these challenging times and deliver on our objectives.” Nasser said Aramco was committed to delivering a dividend of $18.75 billion to shareholders for the third quarter — an amount that exceeds the declared profit and the available cash flow.

The announcement is in line with the company’s pledge to pay an annual dividend of $75 billion after it floated a sliver of its shares last year in the world’s biggest IPO.