(Reuters) – The world’s largest chemicals company Saudi Basic Industries Corp’s (SABIC) chief executive sees growth in the sector globally by the end of 2009, with good signs of growth in China and the United States already, he told television station CNBC.
SABIC’s Chief Executive Officer Mohamed Al Mady said he sees some improvement in prices and that “the first quarter looks good.”
In January, SABIC’s fourth-quarter profit plunged more than 95 percent to 311 million riyals due to a drop in demand for petrochemical products. The company said the fall in demand for petrochemical products, particularly specialty plastics, had a strong impact on the performance of SABIC affiliates outside Saudi Arabia.
Al Mady, however, said, “We are bullish on plastics for the future… plastic will always be with us.”
Shuaa Capital analyst Laurent-Patrick Gally said: “SABIC CEO comments seem to suggest a gradual global recovery for the petrochemical sector may be underway.”
A potential recovery of the petrochemical sector and SABIC’s earnings, along with expectations of a continued recovery into 2010, should provide material share price appreciation for mid- to long-term investors, the analyst said.