Saudi listed firms’ net profit soars as energy, banking sectors shine
Energy firms and banks helped fuel a 32 percent year-on-year rise in aggregate profits for listed companies in Saudi Arabia in the third quarter of 2022, according to a report released by Kamco Invest. The analysis noted that net profits hit $51.9 billion in the three months to the end of September — up from $39.3 billion in the same period of 2021.
The report, however, noted that the aggregate profit of Saudi Arabian firms in the third quarter reported a decline of $7.4 billion compared to the previous quarter this year, where the total net profit stood at $59.3 billion.
Across the Gulf Cooperation Council region, listed firms witnessed a quarter-on-quarter decline of 8 percent at $76.9 billion, due to the fall in the earnings for energy and material companies. “In terms of regions, only UAE-listed companies showed higher profits during the quarter, whereas aggregates for the rest of the GCC countries showed a quarter-on-quarter decline during the third quarter of 2022,” wrote Kamco in the report.
Companies operating in the Kingdom’s energy sector witnessed the maximum profit during the third quarter at $41.2 billion, driven by crude oil prices and volumes sold.
The report further noted that the profit of the banking institutions in Saudi Arabia increased to $4.4 billion during the third quarter, up from $3.5 billion during the same period in 2021.
In the banking sector, Al Rajhi Bank recorded a profit of $1.2 billion in the third quarter, supported by higher net financing and investment income, fees from banking services, and exchange income.
Saudi National Bank reported a 24.6 percent increase in the net profit to $1.3 billion, driven by a 16.1 percent drop in operating expenses due to a lower net impairment charge for credit losses.
Net profit of telecom companies in the Kingdom also grew by 22.2 percent year-on-year to $1.1 billion in the third quarter, while profits for the food and staples retailing sector almost tripled year-on-year to reach $281.6 million.
According to the Kamco report, Saudi Arabian firms operating in the materials, utilities, pharmaceuticals, biotechnology and life sciences, and consumer durables and apparel sectors witnessed a decline in profit during the third quarter.
In terms of year-on-year performance by GCC companies, net profits continued to show growth in the third quarter of 2022 and were up by almost a quarter to reach $70.7 billion as compared to $57.2 billion during the same period in the previous year.