Borouge reports 23% rise in second-quarter net profit as Ruwais operations recover
Abu Dhabi-based petrochemicals company Borouge Plc reported a 23% quarter-on-quarter increase in net profit for the second quarter of 2026, demonstrating operational resilience despite disruption caused by the April incident at its Ruwais complex.
The polyolefins manufacturer reported revenue of $1.4 billion, up from $1.2 billion in the previous quarter, while adjusted EBITDA rose to $401 million and net profit reached $191 million, supported by stronger polyolefin prices, alternative logistics arrangements, and the successful restoration of full asset availability by the end of June, completing repairs to facilities affected by the 5 April incident ahead of schedule.
To maintain customer supply during the disruption, Borouge implemented alternative logistics routes using road, rail, and sea transport, enabling it to ship all volumes produced during the quarter as well as additional material from inventory.
The company recorded production volumes of 0.7 million tonnes and sales volumes of 0.9 million tonnes during the period, with utilisation rates averaging 60%.
Operational recovery supports earnings
The stronger pricing environment helped offset the impact of regional disruptions, with Borouge benefiting from a 53% increase in average realised prices compared with the first quarter.
The company attributed the improvement to a global shortage of polyolefins supply and continued demand for its differentiated product portfolio, which supported a 20% quarter-on-quarter increase in revenue to $1.4 billion.
Higher selling prices partially mitigated increased freight and logistics expenses as well as higher propylene feedstock costs, although these factors continued to weigh on margins during the period.
Commenting on the results, Hazeem Sultan Al Suwaidi, Chief Executive Officer of Borouge Plc, said the company's second-quarter performance reflected "the strength of our operations, the agility of our supply chain, and the outstanding commitment of our people."
He added that “repair work was completed safely and successfully, restoring full production availability across all units affected by the incident on 5 April.”
Higher costs weigh on margins
However, higher costs continued to weigh on profitability. Borouge said EBITDA margins were temporarily impacted by elevated freight and logistics expenses, as well as higher propylene feedstock costs, reflecting the challenging operating environment.
While stronger realised prices helped offset some of these pressures, the company noted that margins remained affected by the additional costs associated with maintaining customer deliveries and navigating regional disruptions.
Despite the operational disruption and higher logistics costs, Borouge said its annual dividend intention of 16.2 fils per share remains unchanged.
The company said its financial discipline and resilient business model continue to support shareholder returns as it navigates short-term disruption.
Borouge 4 expansion advances
Borouge continued to advance its Borouge 4 expansion project during the quarter, with its new Cross-Linked Polyethylene (XLPE) plant reaching commercialisation and delivering its first batch of materials to customers following successful performance testing.
The facility is expected to add 100,000 tonnes of annual capacity, doubling the company's XLPE output and strengthening its ability to supply premium polyolefin solutions for infrastructure and energy applications.
Additional Borouge 4 plants are scheduled to come online in 2026 and 2027, supporting its plans to expand production capacity and drive future growth.
The formation of Borouge Group International AG through the merger of Borouge Plc and Borealis and the acquisition of NOVA Chemicals was completed in March 2026, creating a company with 13.6 million tonnes of annual production capacity and positioning it as the fourth-largest polyolefins producer globally by nameplate capacity.
A tender offer to convert Borouge Plc shares to Borouge Group International AG shares is expected to take place in 2027, subject to market conditions and regulatory approvals.
