Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Saudi Arabian Stock Exchange  >  Saudi Arabian Oil Company    2222   SA14TG012N13

SAUDI ARABIAN OIL COMPANY

(2222)
  Report
SummaryChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

Aramco Plans U.S. Dollar Bond to Plug Funding Gap -- Update

11/16/2020 | 07:00am EST

By Rory Jones and Summer Said

DUBAI -- Saudi Aramco said Monday it aims to issue a U.S. dollar-denominated bond, as the cash-strapped oil giant cuts jobs, considers asset sales and reviews its expansion plans.

Saudi Arabian Oil Co., as the company is officially called, is selling debt even as low oil prices hurt its ability to generate cash for its biggest shareholder, the Saudi government. It is seeking to meet a pledge made last year to pay $75 billion in annual dividends.

Aramco in a statement said it hired Goldman Sachs Group Inc., Citigroup Inc., JPMorgan Chase & Co. and Morgan Stanley, among others, to arrange investor calls on Monday ahead of a debt sale. The oil company, which didn't disclose pricing or how much it will raise, said it plans a multi-tranche bond offering with potential maturities of three, five, 10, 30 and 50 years. The bond issue is likely to raise billions of dollars, and the pricing and size would depend on market conditions, Aramco added.

It could be well timed. Investors are hopeful of a global economic recovery after Pfizer Inc. last week said its coronavirus vaccine was 90% effective in trials. Oil prices have rallied since then.

Aramco made its debut in the bond markets last year, raising $12 billion and giving global investors access to the world's biggest oil company for the first time. The sale prospectus also opened the books on Aramco's once-secretive financials, showing it was then the world's most profitable company and whetting the appetite for equity investors ahead of last December's share offering.

The company announced the dividend commitment in a bid to lure investors to the initial public offering. But the pledge, combined with low oil prices caused by the pandemic, has forced a restructuring at Aramco and a scramble to raise cash. The IPO also failed to attract international buyers, many of whom were discouraged by what they perceived to be an expensive valuation.

On top of raising debt, Aramco is now cutting jobs and reviewing plans to expand at home and abroad, The Wall Street Journal has reported. The company is also considering a sale-and-lease-back agreement for some of its pipeline assets in a deal that could also raise billions of dollars, according to people familiar with the deal. The plan, dubbed "Project Seek," could involve Aramco selling a stake in its infrastructure to investors who would receive a regular payout from the company as it leases the asset, these people said.

Aramco didn't immediately respond to a request for comment on the project.

Earlier this month, the company posted a 45% fall in net income for the third quarter, generating free cash flow of only $12.4 billion, compared with the roughly $18.75 billion it requires each three months to meet its dividend pledge.

Aramco isn't the only major oil company battling to keep its dividend. Exxon Mobil Corp. has also held the line on dividends, instead trimming jobs and capital spending. Other big oil companies such as Royal Dutch Shell PLC and BP PLC have cut payouts to preserve cash amid falling oil demand as a result of the coronavirus.

Since the onset of the pandemic, Aramco's dividend payout has become even more crucial to the Saudi government, which has had to contend with higher costs related to a national lockdown and a stimulus effort to boost the economy. The government owns roughly 98% of the oil company's shares.

Ratings agency Fitch revised its outlook last week on Aramco to negative from stable, after making a similar change for the Saudi government

Write to Rory Jones at rory.jones@wsj.com and Summer Said at summer.said@wsj.com

(END) Dow Jones Newswires

11-16-20 0659ET

Stocks mentioned in the article
ChangeLast1st jan.
BP PLC -1.14% 290 Delayed Quote.13.81%
CITIGROUP INC. -0.87% 61.33 Delayed Quote.-0.54%
EXXON MOBIL CORPORATION -1.41% 47.43 Delayed Quote.15.07%
JPMORGAN CHASE & CO. -0.77% 133.79 Delayed Quote.6.11%
LONDON BRENT OIL -1.92% 55.07 Delayed Quote.7.68%
MORGAN STANLEY -0.76% 74.13 Delayed Quote.8.17%
PFIZER INC. 0.19% 36.55 Delayed Quote.-0.71%
ROYAL DUTCH SHELL PLC -1.93% 16.088 Real-time Quote.10.09%
SAUDI ARABIAN OIL COMPANY 0.00% 34.8 End-of-day quote.-0.57%
THE GOLDMAN SACHS GROUP, INC. 0.01% 289.39 Delayed Quote.9.73%
WTI -1.77% 52.063 Delayed Quote.9.87%
All news about SAUDI ARABIAN OIL COMPANY
01/21Aramco Says to Start Complete Emission Data Disclosure in 2021 After Report F..
MT
01/20MARKET CHATTER : Brookfield, KKR Reportedly Mull $10 Billion Stake in Saudi Aram..
MT
01/19SAUDI ARABIAN OIL : Aramco and stc unveil Dammam 7 Supercomputer
PU
01/13Saudi Aramco cuts Feb crude supply to some Asian refiners - sources
RE
01/07Saudi Aramco Raises Oil Prices for Asia, U.S.
DJ
01/06Energy Rises As Apparent Democratic Sweep In Georgia Seen As Mixed Blessing -..
DJ
2020SABIC seeks Clariant chairman's ouster in post-Christmas coup
RE
2020SAUDI ARABIAN OIL : Aramco continues progress in digital transformation with SAP..
PU
2020SAUDI TV : Houthi sea mine strikes cargo ship in Red Sea
AQ
2020Aramco to bring Google Cloud services to Saudi Arabia
RE
More news
Financials
Sales 2020 819 B 218 B 218 B
Net income 2020 203 B 54 200 M 54 200 M
Net Debt 2020 317 B 84 514 M 84 514 M
P/E ratio 2020 33,5x
Yield 2020 3,96%
Capitalization 6 956 B 1 854 B 1 855 B
EV / Sales 2020 8,88x
EV / Sales 2021 6,64x
Nbr of Employees 79 000
Free-Float 1,76%
Chart SAUDI ARABIAN OIL COMPANY
Duration : Period :
Saudi Arabian Oil Company Technical Analysis Chart | 2222 | SA14TG012N13 | MarketScreener
Technical analysis trends SAUDI ARABIAN OIL COMPANY
Short TermMid-TermLong Term
TrendsBearishNeutralBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 17
Average target price 32,56 SAR
Last Close Price 34,80 SAR
Spread / Highest target 12,1%
Spread / Average Target -6,44%
Spread / Lowest Target -31,0%
EPS Revisions
Managers and Directors
NameTitle
Amin bin Hasan Al-Nasser President, CEO & Executive Director
Yasir bin Othman Al-Rumayyan Chairman
Khalid H. Al-Dabbagh Senior VP-Finance, Strategy & Development
Ahmad Abdul Rahman Al-Sa'adi Senior Vice President-Technical Services
Mark Moody-Stuart Independent Non-Executive Director
Sector and Competitors
1st jan.Capitalization (M$)
SAUDI ARABIAN OIL COMPANY-0.57%1 854 023
ROYAL DUTCH SHELL PLC10.09%151 085
TOTAL SE2.61%116 448
PETROCHINA COMPANY LIMITED5.42%113 685
GAZPROM1.01%69 968
PETRÓLEO BRASILEIRO S.A. - PETROBRAS-4.41%67 412