LoopReef Q2 profits beat previous year

Saudi Aramco's Base Oils "Lubref" achieved its highest quarterly profits since its listing, recording a net profit of 734 million riyals in the second quarter of 2026, marking a 199% increase compared to the same period last year. Despite the significant growth in revenues and operating profits, the results fell short of analysts' expectations, which had projected around 986 million riyals, leading to a 1.3% decline in the company's stock. The main reason for this performance is an improvement in cracking margins and product prices, with the cracking margin rising to 3,600 riyals per ton—an increase of 91% compared to the previous year—alongside a 52% increase in revenue to 3.42 billion riyals. This was achieved despite only a 2% growth in the volume sold. Additionally, the results showed strong free cash flows of 1.06 billion riyals in the first half of the year, along with a solid financial position. The company confirmed its commitment to ongoing expansion and adjustments to the shutdown schedule to capitalize on the higher margins, with expectations that the project will boost production and sales in 2027. Sustainable profits depend on maintaining stable margins for base oils and sales volumes, as recent growth was primarily driven by rising prices and cracking margins rather than volume expansion.

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