Prime Highlights
- Borouge maintained strong production and profitability despite regional disruptions.
- The company adapted logistics and benefited from rising global polyolefin prices.
Key Facts
- Borouge is a leading petrochemicals company based in Abu Dhabi.
- The company produced 1.21 million tonnes in the quarter, operating at 98% capacity.
Background
The company Borouge demonstrated consistent performance during its first quarter because it maintained both production output and profit levels despite experiencing disruptions in its regional shipping operations.
Revenue was pegged at $1.2 billion, with adjusted EBITDA amounting to $343 million. Net income amounted to $156 million. The company kept up its production volume at 1.21 million tonnes, which were produced under nearly full utilization of its facilities, with an efficiency rating of 98%.
Disruption occurred in the shipping routes via the Strait of Hormuz, in light of the growing tension in the region.
However, Borouge responded swiftly by rerouting most of its March cargo shipment through other means. Some of the products were not released to the store for better pricing later.
This response is attributed to Chief Executive Officer Hazeem Al Suwaidi, who saw the challenges coming and planned accordingly. He indicated that early signs of price recovery could support earnings in the coming quarters.
An incident in the first week of April at the Ruwais Industrial Area briefly disrupted a few production lines. Those units have since restarted in phases, and output is moving back toward normal levels.
Market conditions shifted as the quarter progressed. Polyolefin prices rose sharply in March due to tighter global supply and steady demand, particularly for specialised products. Higher freight costs did weigh on operations, but pricing adjustments helped offset part of that impact.
Separately, the company continued work on long-term plans, including its partnership with ADNOC and OMV, and the creation of Borouge International to expand its global presence.
