Saudi Aramco's profit plunges 25% on coronavirus pandemic
The company's income dipped to $16.6 billion for Q1 2020
Saudi Aramco saw a 25% plunge in profit in the first quarter of 2020 to $16.6 billion (62.48 billion Saudi riyals), but was able to retain its dividend. It also noted that it would rein in spending as the coronavirus pandemic continues.
“The COVID-19 crisis is unlike anything the world has experienced in recent history and we are adapting to a highly complex and rapidly changing business environment," said CEO Amin Nasser. "Aramco has demonstrated resilience during economic cycles and has an unparalleled position due to a strong balance sheet and low-cost structure."
Aramco forecasts $25 billion to $30 billion of capital spending in 2020, down from previous estimates of up to $40 billion, and its 2021 expenditure is being reviewed.
“We retain significant flexibility to adjust expenditures and have considerable experience in managing the business through times of adversity. This resilience will enable us to continue delivering on our commitments to our shareholders," Nasser added.
“Looking ahead to the remainder of 2020, we expect the impact of the COVID-19 pandemic on global energy demand and oil prices to weigh on our earnings," he added. "We continue to reinforce the business during this period by reducing our capex and driving operational excellence. Longer term we remain confident that demand for energy will rebound as global economies recover.”
The company will pay a dividend of $18.75 billion for the first three months of the year, but it is unclear if it will stick to the full-year sum of $75 billion as previously planned.