Borouge (BOROUGE) Q1 2025 earnings summary

Executive summary

• Q1 2025 net profit rose 3% year-on-year to $281 million, driven by strong sales volumes, record production, and cost discipline, especially in Asia Pacific and Middle East markets.

• EBITDA reached $564 million, maintaining a 40%+ margin for seven consecutive quarters, reflecting cost discipline and stable pricing.

• Revenue increased 9% year-on-year to $1.42 billion, with sales volumes up 10% to 1,252 kilotons, led by APAC and Middle East markets.

• Dividend guidance for 2025 raised to 16.2 fils/share ($1.33 billion total), with a minimum payout planned through 2030 and a 90% payout policy.

• Share buyback program launched, targeting up to 2.5% of shares, with 64 million shares repurchased to date.

Financial highlights

• Adjusted EBITDA was $564 million, flat year-on-year, with a sustained 40% margin.

• Adjusted operating free cash flow reached $523 million, with a 93% cash conversion ratio.

• Net debt to EBITDA stood at 0.9x as of March 31, 2025, indicating a strong balance sheet.

• Selling & distribution expenses down 38% quarter-on-quarter and 6% year-on-year, supporting margin resilience.

• Polyethylene and polypropylene prices averaged $224 and $154 above guidance, respectively.

Outlook and guidance

• Raised full-year 2025 dividend guidance to 16.2 fils/share, with a minimum floor through 2030 and a projected yield over 6%.

• Share buyback program commenced, reflecting confidence in growth and value.

• Borouge Group International formation on track for Q1 2026, targeting $7 billion EBITDA and $500 million annual synergies.

• Q2 2025 sales volumes and pricing expected to remain stable, with planned Borouge 3 maintenance to reduce Q2 volumes by 320 kilotons.

• Optimistic on core market fundamentals, especially in Asia and the Middle East, with resilient infrastructure demand.