Near-term outlook remains promising, supported by significant contract win from Aramco
Saudi Arabia’s East Pipes Integrated Company for Industry, the top manufacturer of Helical Submerged Arc Welded (HSAW) pipes in Saudi Arabia, recently announced in a press communique, its financial results for the first quarter ending 30 June 2023 (1Q-FY24), reporting a net loss of SAR 19mn.
Financial overview for 1Q-FY24 Revenues of SAR 39mn decreased 81% YoY (1Q-FY23: SAR 206mn) whereby production activities are progressing well, but, in line with the delivery schedules of some projects, the associated revenues fell short this quarter, and inventories increased from SAR 65mn as of 31 March 2023 to SAR 209mn as of 30 June 2023.
A key highlight was a significant contract award of over SAR 1.8bn from Saudi Aramco for the manufacture and supply of steel pipes. The financial impact of this contract will be reflected in 3Q and 4Q-FY24 and 1Q-FY25.
Expansive development initiatives
“We are in a strong position to make an integral contribution to Saudi Arabia’s expansive development initiatives, especially in the vital oil, gas, and water sectors,” stated Mohammed Al Shaheen, Chief Executive Officer, East.
“We have established a robust foundation, to pave the way for the growth of our business in the future. This is particularly supported by our solid financial position, as we saw a remarkable 175% YTD improvement in our cash balances, whilst our working capital management strategies continued to produce fruitful results, with a 42% YoY rise in cash flow generated from operating activities,” remarked Mohamed Darweesh, Chief Financial Officer, East Pipes.
“East Pipes continued to consolidate its leading position in Saudi Arabia’s rapidly growing HSAW pipes industry. The recent contract award by Aramco, is yet another testament to the trust that our valued strategic partners are placing in us,” concluded Ali Al Makrami, Vice President-Commercial, East Pipes.
