Borealis releases q2 financial report, achieves net profit of $193 million

On July 31, Borouge P.J.S.C. (listed on the Abu Dhabi Securities Exchange under the ticker "BOROUGE" / ISIN "AEE01072B225") announced a net profit of USD 193 million for the second quarter of 2025, exceeding market expectations. The results reflect Borouge's strict adherence to the planned Phase 3 maintenance schedule, and through effective cost management and the continued premium of its high-value product portfolio, Borouge maintained strong profit margins and healthy cash flow.

The third phase shutdown maintenance of Boro was successfully executed this quarter. The project was not only carried out safely but also completed within budget and eight days ahead of the original schedule. As the largest and most complex shutdown maintenance to date, Boro optimized the downtime by 15%, fully demonstrating the high efficiency of the company’s planning and execution teams. This type of planned, once-every-six-years regular maintenance is crucial for safeguarding Boro’s world-class assets and maintaining high utilization and production scale.

The adjusted EBITDA for the second quarter was $440 million, reflecting the company's performance exceeding expectations during the planned shutdown and maintenance of Phase III at Bolu. Bolu maintained a healthy EBITDA margin of 34% during this major scheduled maintenance by optimizing its product portfolio.

Hazem Sultan Al Suwaidi, CEO of Borouge, stated: "Borouge's performance is driven by healthy cash flow, rigorous execution, and strong price premiums, especially after successfully completing the largest-ever planned turnaround of Borouge 3. To demonstrate our commitment to creating value for shareholders, we reiterate our plan to increase Borouge's dividend per share to 16.2 fils by 2025, with plans to pay a dividend of 8.1 fils per share for the first half of 2025 in September. The increased dividend is also expected to serve as the minimum distribution standard for Borouge Plc's dividend per share plan at least through 2030."

The price premium of polyethylene (PE) and polypropylene (PP) products remains a highlight this quarter, with PE achieving $249 per ton and PP achieving $141 per ton, both exceeding the management's full-cycle guidance. Thanks to Borouge's ability to flexibly adjust production to maximize net returns, a differentiated product portfolio, and rigorous execution, Borouge has maintained a high-end market position even in a relatively weak market environment.

Operational excellence drives solid second-quarter results.

In the second quarter of 2025, Borouge reported a revenue of $1.31 billion, compared to $1.5 billion in the second quarter of 2024. Considering the planned maintenance project for Borouge Phase 3, this quarter demonstrated a balance between rigorous asset management and Borouge's ongoing commitment to creating value for shareholders. The total sales volume reached 1.1 million tons, remaining largely flat quarter-on-quarter, with approximately 140,000 tons sold from inventory. High-value-added products continued to account for 41% of total sales, maintaining strong growth momentum in infrastructure and advanced packaging applications.

The average selling price decreased by 1% quarter-on-quarter and 3% year-on-year, in line with the broader market environment. While polyethylene (PE) prices remained stable, polypropylene (PP) prices saw a slight decline. During the same period, global benchmark prices for PE and PP also dropped slightly. In this environment, Borouge maintained its pricing discipline and continued to optimize its regional sales structure, allocating a greater share to the Middle East and markets related to Borealis in order to achieve higher net returns.

Adjusted EBITDA for the quarter was $440 million, with an EBITDA margin of 34%, compared to $613 million in the second quarter of 2024. The decline in margin mainly reflects a decrease in average selling prices, while also taking into account reduced production during planned shutdowns for maintenance. Despite the lower production volume, Borouge was still able to maintain a relatively high profit margin, fully demonstrating its cost efficiency, operational management capabilities, and commercial flexibility.

Capital expenditure for the second quarter was $130 million. At the end of this quarter, Borouge's net debt to EBITDA ratio was 1.0 times, maintaining a strong asset balance and significant financial flexibility.

Strong performance in the first half of the year supports the company's intention to increase dividends.

In the first half of this year, Borealis achieved a revenue of $2.72 billion, while in the first half of 2024 it was $2.81 billion. The adjusted EBITDA reached $1 billion, compared to $1.18 billion in the same period last year, with the profit margin being maintained thanks to strong price premiums, cost control, and inventory sales. The total sales volume reached 2.39 million tons, a decrease of only 2% year-on-year, fully demonstrating Borealis' operational resilience and flexibility.

Borouge has proposed to increase the minimum interim dividend for the first half of 2025 to 8.1 fils per share, pending shareholder approval at the upcoming General Assembly in August. This interim dividend reflects the first payment of the previously announced plan to increase the full-year dividend for 2025 to 16.2 fils per share, which is an increase from 15.88 fils in 2024. Based on the current share price, the expected dividend yield is 6.1%, making it one of the highest on the Abu Dhabi Securities Exchange (ADX). This move reinforces the company's mechanism for increasing dividends.

Since its listing in 2022, Boru has distributed a total of $3.58 billion in dividends to shareholders. Following the completion of the proposed transaction of Boru International Group Limited, the newly established entity plans to maintain a minimum dividend of at least 16.2 fils per share annually until 2030. This implies a cumulative return to shareholders of approximately 37%, with strong upside potential. The dividend policy will be based on a 90% dividend payout ratio.

Borouge continues to execute the share buyback program approved at the annual general meeting, reflecting the company's strong confidence in its future development prospects. By the end of the second quarter, the company had completed the repurchase of 125 million shares in accordance with the regulatory requirements of the Abu Dhabi Securities Exchange (ADX).

Borouge 4: Achieving Large-Scale Development and Product Innovation with Borstar® Third Generation Technology

The Borouge Phase 4 project is scheduled to be completed by the end of 2026, at which time an additional production capacity of 1.4 million tons per year will be added, expected to significantly enhance Borouge's profitability and market coverage. Borouge Phase 4 will also serve as the core asset for the proposed Borouge International Group Ltd platform, recorded at original cost, releasing considerable intrinsic value for shareholders. With the growing global demand for durable, low-carbon infrastructure, the Borouge Phase 4 production facility is equipped with Borstar® third-generation (3G) technology, aiming to position the company favorably in its core growth regions, providing specialized, value-added solutions, and leading the industry's development.

Innovation driven by artificial intelligence, digitalization, and technology.

Borouge continues to advance the company-wide Artificial Intelligence, Digitalization, and Technology (AIDT) initiative, which has generated $307 million in value so far this year. A significant milestone this year was the launch of a proof-of-concept project in collaboration with Honeywell to develop the petrochemical industry's first AI-driven control room, enabling Borouge's plant in Al Ruwais to achieve autonomous operations. The company's AIDT initiatives have also received external recognition, including the Gulf Petrochemicals and Chemicals Association (GPCA) Supply Chain Innovation Award and the Industry Eagle Awards.

As part of its ongoing AIDT project, Borouge has integrated ADNOC's AI-driven decision-support technology, MEERAi, into its board meetings. MEERAi is capable of providing real-time, data-driven insights, assisting Borouge's management in making faster and more informed decisions.

Promote product innovation

Borouge continues to expand its differentiated product portfolio in the medical and advanced packaging sectors. In May this year, the company signed a strategic agreement with Mubadala Bio to explore the supply of polyolefin materials for medical devices and pharmaceutical packaging, supporting the “Made in the Emirates (MIITE)” initiative. Following the launch of the UAE’s first locally produced medical-grade polyolefin, Bormed™ RG868MO, a second medical-grade product is expected to be introduced later this year. In the advanced packaging sector, Borouge is promoting a circular economy through recyclable mono-material films, including the upcoming Borstar™ BH555MO, a differentiated polypropylene product that enables higher recycled content, lightweighting, and reduced carbon dioxide emissions.

Borouge will continue to focus on differentiated products in its core regions to support strong price premiums and expects to maintain outstanding performance in the second half of the year. The company continues to flexibly allocate production within its core regions to the markets with the best net returns. With the planned shutdown and maintenance projects successfully completed, the company is well-positioned to optimize capacity and seize opportunities when market conditions improve.