Saudi Arabia’s oil company, Saudi Aramco, released its annual balance sheet and found out what oil and gas industry analysts have already estimated: it is the world’s most profitable, with profitability of US $111.1 billion only last year. But It’s not for less, since the company is producing about 10% of the planet’s oil. This is the 1st balance sheet released by the company in 40 years, since its nationalization.
The state only did not obtain a higher profit due to the heavy tax burden imposed by the Saudi Arabia. Still, it surpassed the Anglo-Dutch competitors Shell (6th place in the ranking with US $23.4 BI) and the American Exxon Mobil (7th place with US $20.8 bi). Despite the performance, ARAMCO is unable to obtain the desired triple A from the risk rating agencies, a note that assesses investor confidence in the company.
Saudi Aramco has made its financial statement public by preparing to launch its shares in the market. Initially, the company will launch debt securities, making a road show (meetings with executives of a company and current or potential investors) in cities such as London, New York, Boston, Hong Kong and Tokyo.
The main goal of the oil raising capital is to buy a slice of the Saudi petrochemicals SABIC, also controlled by the government. The operation is a way to reintroduce more resources into the state machine and strengthen the country’s fiscal situation.
The ambitions of Saudi Prince Mohammed bin Salman are even greater: their goal is for the company to be valued at US $2 trillion. If It succeeds, the government will pocket US $100 billion with the sale in the capital market of a slice of only 5% of Aramco. This profitability would outdo the US $25 billion record of the Chinese Alibaba giant in 2014.
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