Aramco declares $121 billion net profit in 2023
Profit falls from $161.1 billion in 2022
Saudi Arabian Oil Company (Aramco) revealed its full-year 2023 financial results on March 10, 2024. The company’s robust net income of $121.3 billion marked its second-highest-ever net income.
The stellar financial performance, attributed to Aramco’s operational flexibility, reliability, and cost-effective production base, underscores the company’s commitment to delivering value to shareholders, the company said in a statement.
Despite a slight dip from $161.1 billion in 2022, Aramco’s net income of $121.3 billion remains formidable.
The decrease is attributed to lower crude oil prices and volumes, refining, and chemicals margin reduction, partially offset by decreased production royalties, income taxes, and zakat.
Aramco maintained a strong balance sheet, with free cash flow reaching $101.2 billion in 2023.
Financial resilience
At the end of 2023, the gearing ratio was -6.3%, showcasing financial resilience. Total dividends of $97.8 billion were paid in 2023, marking a 30% increase from the previous year.
Capital investments in 2023 rose to $49.7 billion, a 28% increase, reflecting Aramco’s commitment to creating and capturing additional value from operations.
The directive to maintain Maximum Sustainable Capacity at 12 million barrels per day is expected to reduce capital investment by approximately $40 billion between 2024 and 2028.
Amin H. Nasser, Aramco’s President & CEO, said: “In 2023, we achieved our second-highest ever net income, showcasing resilience and agility in the face of economic headwinds. We also increased dividends by 30% year-on-year, demonstrating our dedication to shareholder returns.”
The Saudi oil giant’s current market valuation is $2 trillion, ranking it the fourth most valuable company worldwide. It follows the heels of Apple, Microsoft, and NVIDIA, respectively.
12.8 million barrels
Aramco’s average hydrocarbon production in 2023 was 12.8 million barrels of oil equivalent per day. The company focused heavily on supply reliability and achieved a 99.8% delivery rate.
The company continues progressing on key crude increment projects to enhance reliability and operational flexibility.
Gas projects aim to increase production by over 60% by 2030, with strategic initiatives like the Hawiyah Unayzah Gas Reservoir Storage and the Hawiyah Gas Plant expansion.
Aramco’s entry into the LNG market through a strategic minority stake in MidOcean Energy and acquisitions like Rongsheng Petrochemical demonstrates the company’s commitment to diversification.
The company’s downstream investments, including the Amiral complex and acquisitions in Chile and Pakistan, signify Aramco’s expansion and strategic positioning in the global retail market.
In a quest for renewable energy, Aramco has signed agreements for photovoltaic solar projects in Saudi Arabia. The projects, with an expected combined capacity of 2.66 GW, will commence commercial operations in 2025.
Additionally, Aramco’s inclusion of Yanbu Refinery in the World Economic Forum Global Lighthouse Network underscores the company’s dedication to cutting-edge technologies and the Fourth Industrial Revolution.
Featured image: Aramco pavilion at ADIPEC 2023, held in Abu Dhabi, UAE. Credit: Arnold Pinto
Last Updated on 9 months by Arnold Pinto
