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Aramco Continues With $31bn Dividend Despite Softer Results; All Eyes on Cash Reserves
August 7, 2024
Saudi Aramco has maintained its quarterly dividend at $31bn despite weaker profits and cashflows. Its net income fell 3.4% to $29.1bn in the recent quarter and free cash flows were at $19bn, both of which were lower than the dividend. The company plans to distribute about $124bn in total dividends this year, with a performance-linked component of $43bn. Its net cash position stands at ~$2.3bn as compared to $16bn a quarter ago. Bloomberg Intelligence notes that the projected payouts by Aramco could see the company go into a potential a net debt position as early as Q3. Analysts note that they are keeping a keen eye on Aramco’s payouts and the level of dividends next year, amid depleting cash reserves.
Aramco’s dollar bonds were trading steady, with its 5.25% 2034s at 101.3, yielding 5.1%.
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