An employee at a Saudi Aramco oil processing plant, an oil and gas company in Saudi Arabia, in the Abqaiq oil field.
Stanislav Krasilnikov | TASS | Getty Images
Oil giant Saudi Aramco reported a 44% drop in its 2020 annual results, but maintained its $ 75 billion dividend payout, with CEO Amin Nasser describing the past twelve months as one of the most “challenging years” in recent memory.
Saudi Aramco, Saudi Arabia’s colossal state oil company, reported net profit of $ 49 billion in 2020, down from $ 88.19 billion in 2019. The result was slightly below analyst expectations of $ 48.1 billion, but represents still the highest of all listed companies worldwide.
“In one of the most challenging years in recent history, Aramco demonstrated its unique value proposition through its significant financial and operational flexibility,” Saudi Aramco Chief Executive Amin Nasser said in the company’s statement on Sunday.
Aramco said revenues were impacted by lower crude oil prices and volumes sold, and weakened refining and chemicals margins.
The company also said it expects to cut capital expenditures over the next year, and lowered its spending outlook to about $ 35 billion from a range of $ 40 billion to $ 45 billion earlier.
Free cash flow fell nearly 40% to $ 49 billion, well below the level of the long-awaited dividend. Aramco also declared a $ 75 billion payout for 2020, despite concerns it would take on additional debt to keep it going.
“Looking ahead, our long-term strategy to optimize our oil and gas portfolio is on track and as the macro environment improves, we see a pick-up in demand in Asia and positive signs elsewhere,” he added.
Shares in the top Western oil and gas companies, including Royal Dutch Shell and BP, fell to multi-year lows in 2020 as the coronavirus pandemic wreaked havoc on the global economy and led to a historic oil price collapse. Exxon Mobil, the largest US energy company, posted its first annual loss.