Luberef, the base oil subsidiary of Saudi Arabia’s oil giant Aramco, reported a 50% increase in net income in Q1 despite a decline in revenue.
The higher net income was primarily attributed to lower feedstock prices, leading to higher crack margins, according to Reuters. In the first quarter, Luberef’s net income rose to SAR 446M ($118.92M) from SAR 303M in the same period last year, while revenue decreased by approximately a third to nearly SAR 1.8B compared to Q1 2022. Luberef had listed 30% of its shares in an IPO in December.
The higher profit was “mainly driven by an increase in base oil prices of 6% and a reduction in feedstock prices by 46% compared to (the) same quarter last year,” Luberef said.
“This positive increase (was) offset partially by a reduction in sales volume by 14% compared to (the) same quarter last year,” it added.
At 0748 GMT, Luberef’s shares were trading at 114.4 riyals, representing a 0.7% decrease. However, despite this drop, the shares are still above the IPO price of 99 riyals per share.
