Riyadh – Mubasher: Fitch Ratings affirmed Saudi Basic Industries Corporation's (SABIC) Long-Term Issuer Default Rating (IDR) at "A+" with a stable outlook.
"The ratings reflect SABIC's vertically integrated operations, state of the art world-scale production facilities and access to competitively priced natural gas feedstock," Fitch said.
The report pinpointed that SABIC was able in 2016 to boost its operating efficiency, despite a more challenging operating environment as a result of low chemical prices.
Fitch noted that although the government announced in 2016 plans to phase out subsidies to consumers and companies, feedstock prices for SABIC remained unchanged in 2017.
The research firm expected that feedstock prices will remain unchanged in 2017, with a probable increase in 2018 – 2019.
We generally consider that "A+" is the highest rating attainable for companies in the chemical sector due to the inherent cyclicality of the industry, Fitch said.
