Borouge Announce Cash Dividend of $650 Million for 2023

Borouge Plc, a leading petrochemicals company engaged in providing innovative and differentiated Polyolefins solutions, on Friday said that the shareholders have approved payment of $650 million (7.94 fils/share) as cash dividend for 2023.

Disclosing the decisions taken at its annual general meeting, which was held yesterday, to Abu Dhabi Securities Exchange (ADX), the company also confirmed its intention to pay a total dividend of $1.3 billion for 2024, reinforcing its commitment to shareholder value and demonstrating its confidence and ability in generating earnings and profits even in the face of challenging market conditions.

Borouge has successfully navigated the bottom of the cycle and delivered a significant $1 billion in net profit in 2023.

Borouge’s $607 million Value Enhancement Programme (VEP) contributed a significant 28% to 2023 EBITDA, the highest total impact in any single year of any announced programmes by peers. The company achieved record sales volumes of 5.1 million tonnes, driven by exceptional production and industry-leading asset utilisation rates, adding approximately 200,000 tonnes in polyolefins sales which contributed $106 million EBITDA in 2023.

Borouge Chairman and UAE Minister Dr Sultan Al Jaber said that the company has outperformed its industry peers, demonstrated remarkable operational and financial resilience reinforcing its position as one of the world’s most profitable and innovative polyolefin producers. Borouge is pursuing accelerated growth domestically and internationally.

Locally, Borouge 4, a major strategic growth project, is expected to add approximately $1.5 – $1.9 billion to revenue annually after re-contribution and full production ramp-up of the plant. It will also boost the company’s production capacity by 28%, making Borouge’s Al Ruwais production site the world’s largest integrated single-site polyolefin complex.

He also announced the company’s new expansion project – second ethylene unit (EU2) – is advancing plans to increase our total production of olefins and polyolefins by 230,000 tonne after project completion in 2028, and is expected to contribute approximately $220 million to $250 million to Borouge’s revenue per year.

“Internationally, the company is pursuing accelerated global growth opportunities, including an opportunity in the Asia Pacific region that has reached feasibility stage. I am confident that Borouge will continue to deliver unparalleled performance and growth in 2024 and beyond, supported by its robust business model and focus on innovation and AI technology,” Dr Al Jaber added.

Successful Business Strategy

Borouge CEO Hazeem Sultan Al Suwaidi said that the significant $1.3 billion dividend from 2023 earnings reflects the success of their business strategy and the company’s operational resilience in a challenging market environment.

He said that Borouge’s outstanding operational and commercial excellence yielded exceptional performance compared with its global peers. This was supported by VEP, which enabled the company to optimise revenues and streamline costs amid softening prices globally.

“We will explore in parallel further levers to enhance our competitive cost position. Borouge 4 will significantly increase our capacity by 28% while enhancing our product portfolio and margin. Our focus remains on sustainable growth and delivering value, with our shareholders set to profit from exceptional recurring dividends in the years to come,” he added.

Borouge has embarked on several AI and advanced technology initiatives, which delivered $58 million in value to date in 2023. The company targets several significant milestones that would enable the realisation of around $280 million in value generation in the coming years.

Its Innovation Centre facilitated the introduction of eight ground-breaking products in 2023, including a pioneering solution for gas pipes that is now globally recognised for its unrivalled safety and reliability standards.

Borouge is committed to expanding its leading financial position and stability, ensuring long-term profitability. Borouge’s strategic financial management and operational excellence position it for strong cash and net profit generation, as well as very significant dividend payments throughout the cycle. This strong foundation supports the company’s continued successful growth execution.