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State-owned oil giant Saudi Aramco reported its highest quarterly profit since its record stock market listing in 2019 as oil prices surged in the wake of the Russia-Ukraine war.
State-owned Saudi Aramco reported an 82% jump in profits from $21.7 billion in the corresponding quarter last year to $39.5 billion, higher than estimated figures, for the quarter ended in March this year. Aramco reported a 36% revenue growth during the quarter, yielding a surplus of $15 billion or more.
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This is the company's highest profit since its listing in 2019 as the huge increase was on account of higher oil prices driven up by Russia's assault on Ukraine. US Oil was trading at around $110 per barrel while Brent Crude was around $111 per barrel on Saturday. The company has gradually increased production as its average output was around 10.2 million per day, up 20% YoY.
The oil giant's cash flow from operating activities came in at $38.2 billion, up 44.15% while its free cash flows grew 68% YoY to $30.6 billion. The company's CAPEX during the quarter came in at $7.6 billion as the company expects growth in CAPEX for the next 3 years to support the company's strategies. The company has kept its quarterly dividend the same as last year at $18.8 billion.
“During the first quarter, our strategic downstream expansion progressed further in both Asia and Europe, and we continue to develop opportunities that complement our growth objectives. Against the backdrop of increased volatility in global markets, we remain focused on helping meet the world's demand for energy that is reliable, affordable, and increasingly sustainable.” Amin Nasser, Aramco President, and CEO said in the earnings release.
Saudi Aramco was the largest IPO when it came as the issue was sized at $25.6 billion and was later on increased to $29.4 billion via a 'greenshoe option'. Last week, the company managed to surpass Apple as the most valuable company at a valuation of $2.43 trillion, when the valuation of Apple was around $2.37 trillion.
The stock saw a significant decline during March as global indices had declined. The stock consolidated in a range through almost all of April as it gradually started rising once again in May. The stock currently trades around its lifetime high of SAR 43.00 per share (roughly $11.5). This marks a 32.3% gain for investors since the beginning of 2022.
Article by Aman Agarwal.
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