DOHA: Industries Qatar (IQ), one of the region’s industrial giants with interests in the production of a wide range of petrochemical, fertiliser and steel products, recorded a net profit of QR3.8bn for the period ended September, 2015.
The group recorded strong financial results across all segments during the current year amidst the current economic environment as the sales volumes grew in excess of 12 percent on last year following the return to normal operations of most of the group’s productions facilities which were on extensive maintenance during the first half of 2014. Selling prices, primarily in the petrochemical and steel segment were, however, impacted significantly due to the prevailing depressed oil prices. Cash position across the group has reached QR9.0bn after paying the 2014 dividend of QR4.2bn, an increase of QR1bn, or 12.1 percent, reflecting a strong liquidity position even under stressed trading environment.
Reported revenue for the nine months period was QR4.1bn, a modest decrease of 12.1 percent, over the first nine months of 2014. However, on a like-for-like basis, management reporting revenue — assuming proportionate consolidation under IAS 31 — was QR12.3bn, a decrease of QR1.2bn or 8.8 percent, versus the same period of 2014.
This year-on-year reduction was primarily driven by a significant reduction in petrochemical product prices following the oil price decline that began in early Q4, 2014 which continued to remain low throughout 2015, and a moderate reduction in the fertiliser product prices driven by favorable market conditions primarily for some of the key supplier markets.
Sales volumes, however were significantly up on last year as the group benefited by a comparatively lower number of maintenance days in the current year since most of the group’s production facilities completed their planned and warranty maintenance shutdown in 2014 resulting in a significantly higher maintenance days during 2014. Accordingly, the current year production utilisation reached 104.7 percent.
Net profit for the period under review was down QR0.9bn, or 18.8 percent, against the same period of 2014. This reduction in net profit was entirely driven by the reduced revenues resulting from price deflation across all segments despite the group vastly benefited from improved sales volumes. Significant price deflation noted across petrochemical and fuel additive segments following the oil price plunge that began in late 2014, and fertiliser prices were moderately down on last year driven by favourable market conditions across some of the key supplier markets.
