Ma’aden reports significant profit decline in 9M23 amid global challenges

Saudi Arabian Mining Company (Ma’aden) has reported a drastic 94.5% decrease in profits for the first nine months of the fiscal year 2023 (9M23). This period, spanning January to September, saw the company’s after-tax profits dwindle to SAR 588.52mn ($157mn), a steep decline from the SAR 10.87bn ($2.89bn) recorded in the corresponding period of the previous year.

The sharp fall in profits is primarily due to a significant reduction in sales, which dropped from SAR 30.80bn ($8.2bn) to SAR 21.23bn ($5.65bn) during the nine-month period. Ma’aden’s management has acknowledged the Ukraine conflict’s limited direct material impact on the company’s performance. However, they are committed to vigilantly monitoring the ongoing situation.

Another key factor affecting the company’s financial health is the early repayment of long-term borrowings by Ma’aden Wa’ad Al-Shamal Phosphate Company (“MWSPC”). The subsidiary accelerated the repayment of SAR 3bn ($799mn) of its debt, ahead of schedule, further straining Ma’aden’s profitability.

On the expenditure front, the company reported mixed results. Selling, marketing, and logistics expenses saw a decrease, totaling SAR 437 million ($116 million) compared to SAR 637mn ($169mn) in the same period last year. However, general and administrative expenses surged from SAR 1.08bn ($287mn) to SAR 1.33bn ($354mn) from January to September 2023.

Despite these challenges, Ma’aden recorded a substantial increase in income from other operations and investments, rising to SAR 613mn ($163mn) from SAR 141 million ($37mn). Nevertheless, this was offset by a significant rise in finance costs, which ballooned to SAR 1.7bn ($453mn) compared to SAR 969mn ($258mn) in the previous year’s same period.

Ma’aden’s principal mining activities span across various locations, including Mansourah-Massarah, Mahd Ad-Dahab, and Al-Ba’itha mines. The group’s mining portfolio encompasses gold, phosphate rock, bauxite, and other minerals. As the company navigates these tumultuous times, its strategic decisions and adaptations to the evolving global landscape will be closely watched by industry observers and investors alike.

Add Fertilizer Daily to your followed sources to get market news first  

Enjoyed the story?

Once a week, our subscribers get their hands first on hottest fertilizer and agriculture news. Don’t miss it!