Rare glimpse into Saudi Aramco shows $111 billion net profit

Saudi Aramco profit dwarfed the biggest global companies in 2018

Saudi Aramco profit dwarfed the biggest global companies in 2018

Last year United States oil giants Chevron and Exxon Mobil, Britain's BP, Anglo-Dutch rival Royal Dutch Shell and France's Total together posted almost $80 billion.

Aramco this week will meet global bond investors ahead of its first worldwide bond sale after obtaining its first credit ratings from Moody's and Fitch. Meanwhile Moody's said the company's net income totals $111.1 billion, while its revenue stood at $355.9 billion.

Saudi Aramco was the world's most profitable company in 2018, easily surpassing American behemoths including Apple and Exxon Mobil, according to an extract of the firm's accounts published by Fitch Ratings.

Fitch Ratings, which also saw the accounts, said Aramco reported $224 billion in earnings before tax and depreciation, while maintaining low debt levels.

Saudi Aramco, the world's largest oil company, posted $224 billion in earnings before tax a year ago, Fitch Ratings said Monday, as the secretive giant opens its accounts for the first time.

The planned bond sale follows the announced acquisition of a 70 percent stake in Saudi Basic Industries Corp (SABIC), the world's fourth-largest petrochemicals maker, from Saudi Arabia's Public Investment Fund (PIF), in a deal worth $69.1-billion.

The huge deal gives Crown Prince Mohammed bin Salman's ambitious reform programme aimed at diversifying the economy a massive cash boost.

Based on its finances, massive hydrocarbon reserves and low production cost, its stand-alone rating would have been a top AA+ on an equal footing with worldwide oil companies.

The world's top oil producer, Saudi Aramco, became world's top company in terms of profits in 2018, comfortably eclipsing the earnings of Apple and other USA firms, according to newly published figures by Moody's and Fitch.

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Previously reluctant to disclose its financials, Aramco had to reveal them in order to obtain a public rating and start issuing public global bonds.

It would help test investor interest and appetite before the potential listing of the firm, Raghu told AFP.

The deal was struck after the crown prince's early efforts at attracting Western investors for his social and economic transformation plans suffered a setback following the killing of Washington Post columnist Jamal Khashoggi by Saudi agents inside the country's consulate in Istanbul previous year.

"The company's balance sheet leverage has been conservatively managed", said the agency, adding it has $46.8-billion of bank facilities, of which about $25.5-billion was still available.

The fund has major global investments including a stake in ride-hailing app Uber.

Fitch said it expected Aramco, which has an abundance of cash flow and low debt, to finance the SABIC deal mainly through its free cash flow.

"This acquisition will strengthen the company's business profile given that downstream assets typically provide countercyclical cash flow benefits", it said in reference to the volatility of oil prices.

"In 2018, its (Aramco's) liquids production and its total hydrocarbon production averaged 11.6 million and 13.6 million barrels of oil equivalent per day, respectively", Fitch said.

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