Sibkam's Losses Rise Due to Inventory Buildup
Saudi Basic Industries Corporation (SABIC) shows a deterioration in its financial performance during the second quarter of 2026, with its losses increasing by 250% year-over-year to reach 592 million riyals, compared to 170 million riyals in the same period of the previous year. The main reason for this is a decline in sales resulting from supply chain challenges, which led to an accumulation of unsold inventory, and rising raw material prices such as butane, ethylene, and propane, which hurt its profit margins. Additionally, routine maintenance of one of its investments and losses in the value of a joint venture impaired revenue, which dropped by 55% to 861 million riyals despite an increase in average product prices. Notably, the company shifted from profitability to a loss in the first quarter of the same year, with a plan to expand its production capacity through a new methanol plant in Jubail Industrial City, after the Saudi Ministry of Energy approved allocating raw materials for this project. The expansion is expected to increase the company's total production capacity by 45%.
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