Despite Covid-19 challenges, SABIC's performance in 2021 was exceptional and is moving ahead with its vision of becoming the preferred world leader in chemicals

In its full year earnings, Sabic, the Riyadh-based chemicals giant, posted the fourth highest annual EBITDA in its history at SR48.3 billion ($12.87 billion) in 2021 – an increase of 139 per cent on the previous year – and recorded a net income of SR23 billion, a significant improvement on 2020’s SR67 million.

For Yousef Abdullah Al-Benyan, Sabic’s Vice Chairman and CEO, there are many positives to take from an annual performance that helped support higher dividends and positioned Sabic for resurgent growth.

He explains: 'Sabic’s fourth quarter results saw us end the year on a strong note. Those results were driven by our operational performance and higher prices for most of our key products. This led to higher EBITDA during the fourth quarter of 2021.'

He adds: 'Looking back on 2021, our financial performance was strong throughout the year, supported by favorable market conditions, and our focus on capital discipline.'

Amid all the ad-hoc changes to the business world, Sabic has emerged stronger. But there is no room for complacency.

The company has embraced new norms related to employee well-being; environmental, social and governance (ESG) standards; and digitalisation.

It is a collective commitment that has underpinned exceptional performance to date and its plans to further evolve its business model to drive more value creation, more sustainability, and more innovation through ambitious growth into 2022 and beyond.

CARBON NEUTRALITY

Whatever new surprises may be around the corner for Sabic, the company is committed to scaling new heights for sustainability and last year set out a clear roadmap toward achieving carbon neutrality by 2050.

Announced at the Saudi Green initiative (SGI) in October 2021, Sabic publicly committed to efforts aimed at ensuring all operations under its control—not just Saudi-based ones—will be carbon neutral by 2050, taking into account the different regional and national circumstances.

The move includes an interim target of a 20 per cent reduction (relative to 2018) in direct and indirect greenhouse-gas (GHG) emissions generated by its own production by 2030.

Already Sabic has identified more than 90 carbon-neutrality initiatives that it believes will help reduce GHG emissions.

'Our global carbon neutrality strategy reaffirms our commitment to the Paris Agreement goals and the continuous pursuit of solutions that can reduce greenhouse gas emissions,' says Al-Benyan who also acknowledges Sabic’s ability to help drive the SGI.

'Sabic is uniquely contributing to the SGI goals and taking bold actions that support the Kingdom’s ambitions for the circular carbon economy,' he says.

'Many countries are competing for position as the world looks to reduce carbon emissions. The foresight of Vision 2030, our abundant renewable resources and the innovative advances made by Saudi Arabian companies are making circularity a reality, placing the Kingdom in pole position to lead the new energy revolution.'

CIRCULARITY

Al-Benyan ... leading Sabic's performance

In promoting sustainable development and collaborative innovation more broadly around the world, Sabic is actively advocating its circular carbon solutions. These include a range of certified renewable polymers, the production of blue ammonia, and the development of the world’s largest CO2 capture and purification plant.

Through its Trucircle initiative, Sabic is continuing to challenge open-ended value chains and drive forward a circular economy for used plastics.

In 2021, Frost & Sullivan, a leading business consultancy, named Sabic Global Company of the Year for sustainability practices and circular economy.

Al-Benyan says: 'Sabic is committed to finding innovative solutions including our Trucircle portfolio and services, which will help to transform our industry from a linear into a circular economy.'

He adds: To do this, we are collaborating with a wide range of partners globally across the value chain to realise our vision of a closed loop for used plastics and moving towards a sustainable, circular future. Sabic is all set to continue leading the global market for more sustainable material solutions.'

ESG

Ahead of its 2050 target, Sabic is also continuing to develop capabilities that enable it to pursue profitable growth and follow through on Environmental, Social and Governance (ESG) imperatives.

Its commitment to adopting the highest ESG standards saw the company awarded with the ‘Best ESG Award’ at the Saudi Capital Market Awards 2022. The sought-after honor rigorously assessed a range of key factors including ESG governance, frameworks used for ESG Reporting, and major ESG achievements and more.

Acknowledging the success, Al-Benyan says: 'We are proud to have been recognised as a leader in ESG standards in the Kingdom. Sound and effective corporate governance, a sense of responsibility towards stakeholders and society, and a concern for economic and environmental sustainability, have been essential elements of Sabic since our foundation. Moving forward, we will continue to find new and effective ways of embedding these ESG imperatives into every level of our organisation.'

POSITIONED FOR GROWTH

By rapidly adapting to the new norms of recent years, Sabic has instilled greater resilience to external disruptions and greater agility of response.

Now, as the race for sustainable growth accelerates, the company is in a strong position to overcome short term hurdles and thrive in the long term as it delivers ‘Chemistry that Matters’.