Borouge prepares for era of ‘transformative’ growth

• $281m Q1 net profit, revenue up 9% to $1.42bn
• Sales volumes up 10% year-on-year
• Solid demand across Asia, the Middle East and Africa

UAE petrochemicals company Borouge is focusing on international expansion and long-term value creation as it gears up to become a next-generation global powerhouse. 

Borouge reported first-quarter net profit of $281 million and record production of 5.2 million tonnes at the end of April, driven by exceptional utilisation rates of 110 percent for polyethylene and 98 percent for polypropylene.

Chief executive Hazeem Sultan Al Suwaidi said Borouge was strategically positioned for a new phase of growth.

“Borouge’s robust first-quarter performance underscores our commitment to operational excellence, continuous cost discipline and strategic growth,” he said. 

The company’s revenue rose 9 percent year-on-year to $1.42 billion, fuelled by stronger sales and an increase in average selling prices of polyethylene and polypropylene. 

Total sales volumes rose 10 percent, supported by solid demand in the company’s core markets across Asia Pacific, the Middle East and Africa, while production volumes rose 7 percent.

Borouge also confirmed an increased full-year dividend of $1.3 billion for 2024 (equivalent to 15.88 fils per share) and initiated a share buyback programme of up to 2.5 percent of outstanding shares. The company announced its intention to increase the dividend for 2025 to 16.2 fils per share.

“Our increased sales and production volumes and intended dividend of 16.2 fils per share for 2025 reflect our confidence in the company’s growth prospects,” Al Suwaidi said.  

“These achievements, coupled with our ongoing efforts to enhance sustainability and innovation, position Borouge well for continued success, growth and long-term value creation for our shareholders.”

Borouge

As part of its plans, the polyethylene and polypropylene specialist is ramping up production at its second ethane cracker (EU2) and its fourth and fifth polyethylene units (PE4 and PE5) in Ruwais, Abu Dhabi. 

This expansion is expected to contribute $165-$200 million in annual earnings before interest, tax and depreciation.

Together with the Borouge 4 mega project, these expansion projects once fully ramped up will increase the company’s annual total polyolefins production capacity to over 6.6 million tonnes per annum by 2028.

The capacity expansion will enable the company to meet growing market demands, unlock new revenue streams and further strengthen its global market position, it says.

Borouge’s growth plans play an integral part in supporting the UAE’s Operation 300 Billion strategy, which aims to increase the industrial sector’s contribution to the UAE’s GDP to AED 300 billion by 2031.

To further support this initiative Borouge has signed agreements with life sciences company Mubadala Bio and Chinese luxury new energy vehicle maker ROX Motor at the annual Make It in the Emirates event, which aims to promote local manufacturing and industrial growth in the UAE.

The joint R&D programme with ROX Motor aims to build a localised automotive supply chain, with a focus on polyolefin product development, innovation and supply.

Borouge will work with Mubadala Bio to explore supplying polyolefin materials that enable local manufacturing of medical products, such as syringes and IV pouches, supporting the advancement of the UAE’s healthcare and life sciences sectors.

Borouge

Meanwhile the company is pushing ahead with the proposed combination of Borouge and Borealis, and the acquisition of Nova Chemicals, to create Borouge Group International, a $60 billion global petrochemicals leader. 

Once complete, the deal will create the fourth largest polyolefins company in the world. 

The new entity is expected to launch operations in the first quarter of 2026, subject to legal and regulatory approvals, and will build on Borouge’s strong operational and commercial performance, according to Al Suwaidi.

“This is not only about creating scale but building a global leader that will deliver consistently strong dividends and significant near-term growth,” he said.

“As we stand at this pivotal moment in our company’s history, we look ahead to a new era of transformative growth, while remaining committed to delivering exceptional value to our shareholders.”

Starting from this year, Borouge intends to increase its dividends payout to an attractive minimum of 16.2 fils per share. 

“This will also serve as the intended dividends payout for Borouge Group International up to 2030, representing one of the highest yields in the UAE,” the chief executive said. 

“This exceptional dividend will be consistently maintained for a minimum of six years.”

Borouge is backed by the Abu Dhabi National Oil Company (Adnoc) and Austria’s OMV. Adnoc holds a 54 percent stake, while Borealis (a joint venture between Adnoc and OMV) owns 36 percent. The remaining 10 percent is publicly traded.

The proposed Borouge Group International will be jointly controlled as an equal partnership between Adnoc and OMV (46.94 percent each), with the remaining 6.12 percent in free float.