SABIC profit boosts Saudi as Qatar hit by weak earn­ings

Kuwait Times - - BUSINESS -

DUBAI: Saudi Ba­sic In­dus­tries (SABIC) helped lift Riyadh’s stock mar­ket yes­ter­day af­ter it re­ported a third-quar­ter net profit at the top end of fore­casts, but a loss at Qatar’s third­largest bank dragged that mar­ket lower. Egypt slid for a fourth straight ses­sion. Riyadh’s stock in­dex re­bounded 1.1 per­cent, end­ing three days of de­clines and trim­ming its loss since Sun­day to 3.0 per­cent. SABIC, the Gulf’s largest petro­chem­i­cal pro­ducer, climbed 1.8 per­cent to 84.00 riyals af­ter post­ing a net profit of 5.22 bil­lion riyals ($1.39 bil­lion) in the three months to Sept. 30, down 6.8 per­cent from a year ago. An­a­lysts polled by Reuters had on av­er­age pre­dicted 5.05 bil­lion riyals.

Riyad Cap­i­tal said in a note that al­though SABIC’s sales dipped on a quar­terly and yearly ba­sis, mar­gins ex­panded to off­set some of that neg­a­tive im­pact. It raised its tar­get price for SABIC to 86.00 riyals from 80.00 riyals but main­tained a “neu­tral” rating. “We have in­creased gross mar­gin as­sump­tions for the full year and be­yond as global petro­chem­i­cal spreads have been healthy.” Roughly two-thirds of Saudi petro­chem­i­cal pro­duc­ers have now re­ported third-quar­ter earn­ings, with gen­er­ally weak re­sults. Nama Chem­i­cals, a mid-sized pro­ducer, said yes­ter­day it made a loss of 32.6 mil­lion riyals ver­sus a loss of 24.0 mil­lion in the same pe­riod of 2015; its shares closed flat.

Mid­dle East Health­care jumped 7.8 per­cent af­ter its quar­terly net in­come rose 1.4 per­cent to 92 mil­lion riyals. The pos­i­tive mood spilled into some shares that were hit ear­lier this week by dis­ap­point­ing re­sults. Lender Saudi Hol­landi re­bounded 2.4 per­cent. But Emaar the Eco­nomic City, de­vel­oper of an in­dus­trial city near Jed­dah, dropped 1.6 per­cent af­ter re­port­ing a third-quar­ter net loss of 81 mil­lion riyals ver­sus a profit of 8 mil­lion riyals a year ago.

In Dubai, the in­dex built pos­i­tive mo­men­tum in the last hour of trade to close up 0.1 per­cent. No ma­jor com­pa­nies posted fresh re­sults; DXB En­ter­tain­ments climbed 3.3 per­cent ahead of open­ing its theme parks at the end of this month. Gains in blue chips helped boost Abu Dhabi’s stock in­dex 0.9 per­cent. First Gulf Bank added 1.8 per­cent, trim­ming its losses to 1.3 per­cent since Sun­day.

Qatar, Egypt Un­der­per­form

In Qatar, the in­dex closed down 0.3 per­cent as Com­mer­cial Bank of Qatar dropped 4.8 per­cent. The bank made a net at­trib­ut­able loss of 1.04 mil­lion riyals ($285,612) in the third quar­ter ver­sus a profit of 275.9 mil­lion riyals a year ear­lier; an­a­lysts polled by Reuters had forecast a profit of 281.7 mil­lion riyals. The bank cited pro­vi­sions for non­per­form­ing loans, af­ter for­mer Aus­tralia and New Zealand Bank­ing Group banker Joseph Abra­ham was ap­pointed chief ex­ec­u­tive in July. Medi­care Group sank 2.9 per­cent af­ter re­port­ing an 85 per­cent drop in third-quar­ter net profit to 4.8 mil­lion riyals. Qatar In­surance fell 0.7 per­cent on a 6 per­cent drop in third-quar­ter profit to 108.8 mil­lion riyals, con­sid­er­ably be­low EFG Her­mes’ forecast of 312 mil­lion riyals. In Cairo, the in­dex of the 30 most valu­able shares pulled back 0.7 per­cent in mod­est vol­ume. He­liopo­lis Co for Hous­ing lost 0.6 per­cent af­ter re­port­ing a 47.9 per­cent drop in quar­terly net profit. —Reuters

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