Profits of Yansab, a company majority-owned by SABIC, surged 51%—fourfold—during the second quarter of the current year, supported by higher product prices that drove a significant boom in profit margins, alongside the company's continued exports, as it exports most of its products through Red Sea ports despite regional tensions, leveraging the location of its plant in Yanbu Industrial City and its exports through the King Fahd Industrial Port on the western coast.

According to the financial analysis unit at the Al-Eqtisadiah newspaper, the company's profits exceeded Bloomberg's consensus estimates, despite setting aside provisions and facing higher costs due to rising prices for certain production inputs.

The company achieved its highest quarterly revenue in four years at SAR 1.6 billion, marking its highest growth in seven quarters, benefiting from higher product prices driven by geopolitical tensions, alongside operational efficiency resulting from plant reliability.

Wed, 22 2026

Highest profits in 4 years despite rising costs and provisions

Although the cost of sales rose at its fastest pace in five quarters by 11% to SAR 1.35 billion, its ratio to revenue recorded its lowest level since the end of 2021 at 72%, as revenue grew at more than twice the pace of costs.

This equation produced the company's highest gross profit in four and a half years at SAR 534 million, growing at a pace exceeding four times the revenue growth.

Despite operating expenses rising at their fastest pace in over four years, operating and net profits quadrupled with a growth rate of 480%, even though the company set aside a provision worth SAR 104 million.

Excluding the provision, the company's profits reach SAR 363 million, the highest in more than five years.

Mon, 09 2026

Massive leap in profit margins

Higher prices triggered a boom in margin improvements, doubling them several times compared to the comparative and previous periods.

The gross profit margin rose to 28.4%, double the comparative period and 1.5 times the previous quarter, while the operating and net profit margins stood at approximately 14.5%, double the level of the second quarter of 2025 and 15 times the previous period.

How the company's revenues are geographically distributed

According to 2025 data, Yansab relies on exporting most of its products abroad, with a concentration in Asia and the Middle East at shares of 43% and 28%, followed by smaller shares for Africa, Europe, and the Americas at 17%, 8%, and 4%, respectively.

This clear reliance on exports demonstrates the extent to which the company has benefited from exporting its products via the Red Sea coasts amid geopolitical tensions in the region.

Strong stock reaction and valuation improvement following earnings surprise

The stock showed a strong reaction to the company's better-than-expected results, closing up 4% at SAR 32.56, trading at a price-to-earnings ratio of 57x, which is one-fifth of the previous quarter's level of 260x, and half of its rate from a year ago at 112x.

As for the cash dividend yield, it dropped to 6.1% over the past 12 months, but it remains an attractive yield compared to the market yield of 3.5%.

The yield calculation is based on the company's announcement today of a dividend of SAR 1 per share for the first half of the current year, which is the same as the distribution for the second half of 2025, meaning cash distributions of SAR 2 per share over the past 12 months.

How did product prices move in the second quarter of 2026?

The company disclosed the price movements of its most prominent products, stating that demand for monoethylene glycol (MEG) improved relatively, supported by seasonal demand and higher operating rates for polyester plants, with prices remaining high throughout most of the quarter.

As for polyethylene (PE), markets witnessed an improvement in demand and higher prices due to limited supply and rising shipping costs, with prices expected to gradually stabilize.

Regarding polypropylene (PP), the company noted improved demand and price levels during the quarter, supported by higher production costs, limited supply, and the continuation of maintenance work by some producers.

Wed, 18 2024

Expectations of continued gradual improvement for the petrochemical sector.. but what about the impact of tensions?

The company stated that the petrochemical sector is expected to continue its gradual recovery in demand levels during the third quarter of 2026, supported by improving industrial activity and manufacturing indicators in key markets.

On the other hand, the company emphasized that geopolitical events remain the primary factor in the markets, continuing to impact supply chains, logistic costs, and certain production inputs, alongside the entry of new production capacities.

Financial Analysis Unit