Stock Review: Saudi Kayan Petrochemical (2350:SAR8.65) lifts 2.6%, reports deterioration in Loss 01 June 2020

STOCK REVIEW

Dateline: Monday June 01, 2020

Saudi Kayan Petrochemical Company (TASI:2350), Saudi Arabia's 4th largest Petrochemical industries company by market cap, has lifted 22.0 hallalah (2.6%) from its previous trading session to close at SAR8.65. Compared with the All Share Index (TASI) which rose 75.8 points (1.1%) in the day, the relative price increase was 1.6%. The volume was 0.3 times the average daily trading volume of 17.4 million shares. There were 6,017,616 shares worth SAR52.1 million (US$13.9 million) traded today. Today the stock traded between its 13-day high of SAR8.66 and 11-day low of SAR8.35.

Financial News

Quarterly Report (Q1/2020):

May 21, 2020

Quarterly Report Analysis Q1 2020: Saudi Kayan Petrochemical reports deterioration in Loss

Saudi Kayan Petrochemical (TASI:2350) announced loss for the quarter-ended 31 March 2020 [Q1/2020] of SAR517m ($US138m), a deterioration from SAR167m ($US44.6m) in the previous quarter [Q4/2019].

Click here to export Financials table in xls

Bearish Turning Points

Relative Strength Index (RSI)

The Relative Strength Index (RSI) of 71.0 has penetrated the overbought line of 70, suggesting the price gain of 6.7% in the last 14 days is unusually high. The RSI was previously 69.8.

Williams % R

The stock is overbought according to the Williams % R indicator of -4.5, suggesting the price is close to its 14-day high. The Williams % R was previously -29.5.

Stock Summary

Currency1 USD = 3.75 SARSectorPetrochemical Industries
Jun 01 closeSAR8.65Shares Outstanding1,500,000,000
Ave Daily Volume17,411,317 sharesMarket CapSAR13 billion [USD3.5 billion]
52-Week Range6.77 - 12.90

Financials Summary:

+ Sales were down 66.9% from USD957.4 million in FY2018 to USD316.5 million in FY2019.

+ Net profit down from a loss of USD453.9 million in FY2018 to a loss of USD169.8 million in FY2019.

Year ended DecFY2019FY2018FY2017
Sales (USD M)316.5957.4648.9
Pretax (USD M)(143.6)501.6211.3
Net (USD M)(169.8)453.9178.2

INDEX

SECTION 1 News In The Past Two Months

SECTION 2 Corporate Profile

SECTION 3 Today's Bullish Signals

SECTION 4 Ongoing Bullish Parameters

SECTION 5 Today's Bearish Signals

SECTION 6 Ongoing Bearish Parameters

SECTION 7 Saudi Kayan Petrochemical Board of Directors

SECTION 8 Financials Q1 2020, Past 10 Years

SECTION 9 Peer Group Analysis & Ranking

SECTION 10 News Archives (Dec 2018 - Sep 2019)

Glossary

SECTION 1 News In The Past Two Months

1.1 Press Releases

April 30: Saudi Kayan Petrochemical Co. announces its Interim Financial Results for the Period Ending on 2020-03-31 ( Three Months )

Source mubasher.info

SECTION 2 Corporate Profile

2.1 Activities

Saudi Kayan Petrochemical operates in the chemical and petrochemical industry. The Company operates a petrochemical complex located at Jubail Industrial City, with an annual production capacity exceeding 4 million metric tons of petrochemical and chemical products.

2.2 Contact Details

Websitehttp:// http://www.saudikayan.com
Physical AddressPO Box 10302 , Al -Jubail Industrial area , Kingdom Of Saudi Arabia
Phone33593000
Fax33593111
EmailShares@Saudikayan.sabic.com

SECTION 3 Today's Bullish Signals

3.1 Rank in the top 11% by Relative Valuation in the Saudi Arabian market

DescriptionValueRank
Price to Book Value0.9In Top 11%

3.2 Uptrend

Today's Volatility:

Today its volatility (highest price minus lowest price/lowest price) of 3.7% was 1.6 times the average daily volatility of 2.2%, up from 2.5% on Sunday and 3.5% on Thursday. A rise in the price on high volatility is a bullish signal.

Beta > 1 combined with price rise. The Beta of the stock is 1.0.

Positive MACD:

- The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 8.35 minus the 26-day EMA of 8.23 is positive, suggesting a bullish signal. Both the 12-day EMA as well as the 26-day EMA are rising, another bullish signal.

Past Month:

- Rises to Falls: In the past month the number of rises outnumbered falls 10:5 or 2:1.

3.3 Undervaluation

Price to Book of 0.9 < Sector average of 3.5:

- The Price to Book of 0.9 is lower than average of 3.5 for the Petrochemical Industries sector.

MCap/Total Assets:

- Tobin's Q Ratio, defined as MCap divided by Total Assets, is 0.4. Compared with the rest of the market the stock is undervalued and ranks in the top quartile of stocks by value of Q Ratio.

SECTION 4 Ongoing Bullish Parameters

4.1 Rank in the top 15% by Size in the Saudi Arabian market

DescriptionValueRank
Ave daily TurnoverSAR52.1 million (US$13.9 million)In Top 5%
MCapUSD3.5 billionIn Top 15%

4.2 Present Value of SAR1000 Invested in the Past [3 Mo, 3 Yrs]; The Best Periods with PVSAR1000 > 1,017

PVSAR1,0003 mo ago3 yrs ago
2350.TASISAR1,018SAR1,038
Petrochemical Industries sectorSAR1,142SAR964
All Share Index (TASI)SAR998SAR1,062

4.3 Past quarter: price rise of 1.8%

3-Month price change of 1.8% for Saudi Kayan Petrochemical outperformed the change of -0.8% in the All Share index (TASI) for a relative price change of 2.5%.

Price Change %Quarter
Saudi Kayan Petrochemical1.8
Petrochemical Industries sector14.2
All Share index (TASI)-0.8

4.4 Increased Volume, up 43% in 5 years

In the past five years, Average Daily Volume of Trading (ADVT) has increased 43.2% to 17.4 million shares.

Avg. Daily Volume Traded 12 months ended Jun 01, million shares

YearADVT
202017.4
20198.4
20189.5
201711.7
201612.2

4.5 Increased VWAP, up 48% in 5 years

In the past five years Volume Weighted Average Price (VWAP) has increased by 48.2% to SAR9.98. .

Past five years, 12 months ended Jun 01 (SAR)

YearHigh PriceVWAPLow Price
202012.99.986.77
201918.5915.0511.18
201815.211.428.08
20179.857.425.05
201611.96.734.4

4.6 Satisfies one criteria of Benjamin Graham

-"Current ratio of two or more"; current assets are 2 times current liabilities.

SECTION 5 Today's Bearish Signals

5.1 Rank in the bottom 2% by Relative Valuation in the Saudi Arabian market

DescriptionValueRank
Price to Sales19.3In Bottom 2%

5.2 Rank in the bottom 4% by Price Performance in the Saudi Arabian market

DescriptionValueRank
Price/MAP2000.8In Bottom 4%

5.3 Downtrend

Price/Moving Average Price of 0.8:

- The Price/MAP 200 of 0.8 for Saudi Kayan Petrochemical is lower than the Price/MAP 200 for the All Share Index (TASI) of 1.03.

- The price to 200-day MAP ratio is 0.8, a bearish indicator. In the past 200 days this ratio has been under 0.8, 164 times suggesting further downside. The 50-day MAP of SAR8.08 is lower than the 200-day MAP of SAR10.81, another bearish indicator.

Past Quarter:

- In the last three months the stock has hit a new 52-week low seven times, pointing to a significant downtrend.

Trailing Relative Strength (6 months) at 22 percentile:

- The stock has a 6-month relative strength of 22 in the Saudi Arabian market of 176 stocks indicating it is trailing 78% of the market.

5.4 Overbought/Bearish Signals:

- The Relative Strength Index (RSI) of 71.0 has penetrated the overbought line of 70, suggesting the price gain of 6.7% in the last 14 days is unusually high.

- The stock is overbought according to the Williams % R indicator of -4.5, suggesting the price is close to its 14-day high of SAR8.69.

SECTION 6 Ongoing Bearish Parameters

6.1 Annualised Period-based Total Shareholder Returns [TSR %]: The Worst Periods with TSR < 1.3%

TSR %1 yr3 yrs5 yrs10 yrs
2350.TASI-26.91.2-5.9-7.2

6.2 Present Value of SAR1000 Invested in the Past Year; The Worst Period with PVSAR1000 < 732

PVSAR1,0001 yr ago
2350.TASISAR731
Petrochemical Industries sectorSAR803
All Share Index (TASI)SAR856

6.3 Past year: price fall of 26.9%

1-Year price change of -26.9% for Saudi Kayan Petrochemical underperformed the change of -14.4% in the All Share index (TASI) for a relative price change of -12.5%.

Price Change %Year
Saudi Kayan Petrochemical-26.9
Petrochemical Industries sector-19.7
All Share index (TASI)-14.4

6.4 Moving Annual Return of -26.9% in the past year:

Moving Annual Return was -26.9% in the past year. Based on a dynamic start date of 5 years ago, the real rate of return has averaged 2.5%. The Moving Annual Return has been negative in 3 out of 5 years.

2350Close (SAR)Annual Return %
Jun 018.65(26.9)
1 Yr ago11.84(16.5)
2 Yrs ago14.1870.2
3 Yrs ago8.3332.2
4 Yrs ago6.3(46.4)

Close 5 years ago SAR11.75

6.5 Deteriorated EBIT Margins:

EBIT margin is negative and has deteriorated from 15.3% to -5.6% in the past year.

FYEBIT Margins (%)
2019-5.6
201815.3
20177.9
20162.7
2015-7.4

6.6 Declining share turnover, down 35% in 5 years

In the past five years, average daily share turnover has decreased 35.1% to SAR51.8 million (US$13.8 million). This suggests decreased liquidity.

Past five years, 12 months ended Jun 01 (SAR million)

YearAverage Daily Turnover
202051.8
2019123.6
2018108.4
201784.0
201679.9

6.7 Quarterly Trend in Revenue and Net Profit Margin:

- Revenue growth and Net Profit margin have shown signs of deterioration in recent quarters. [All figures in %]

Qtr-endedRevenue GrowthNet Profit Margin
Dec 19 [Q4 vs Q3]-37.2-7.4
Sep 19 [Q3 vs Q2]55.50.1

SECTION 7 Saudi Kayan Petrochemical Board of Directors

7.1 Board and Management

NameDesignationSince Appointment
Omar Bin Ali Al RaheeliChief Executive Officer2 Yrs, 4 Mos
Nasser bin Abdulaziz AbanmaiPresident-
Omar A. Al-AmoudiChairman-
Mohammed A. Al-GhamdiDirector-
Taha A. Al-KuwaizDirector-
Fahad M. Al-DawoodDirector-
Mansour Al-KharboushDirector-
Abdullah S. NojaidiDirector-
Awadh M. Al-MakerDirector-
Tariq Al-AbdulhadiDirector-
Abdulaziz A. Al-HabardiDirector-
Yehia Ben Eissa Al AnsaryDirector-
Ayed H. Al-HaiderCompany Secretary-

SECTION 8 Financials Q1 2020, Past 10 Years

8.1 Quarterly Report (Q1/2020): Key Parameters

Saudi Kayan Petrochemical reports deterioration in Loss

Release Date: May 21, 2020

Saudi Kayan Petrochemical (TASI:2350) announced loss for the quarter-ended 31 March 2020 [Q1/2020] of SAR517m ($US138m), a deterioration from SAR167m ($US44.6m) in the previous quarter [Q4/2019].

Quarter-ended31 Mar [Q1/2020]31 Dec [Q4/2019]30 Sep [Q3/2019]
Revenue, SAR million-210244389
Revenue, $US million-55.965.1104
Sequential growth in Revenue %--37.255
Net Profit, SAR million-517-1671.3
Net Profit, $US-138million-44.6million334,934

Currency Conversion (March 31, 2020): $US1 = SAR3.75

Currency Conversion (March 31, 2019): $US1 = SAR3.75

8.2 Download SAUDI KAYAN PETROCHEMICAL Financials Past 10 Years

Description (December 31)2019201820172016201520142013201220112010
Income Statement
Revenue per share 5.327.786.96.32
Other Revenue (M)127.8224.8133.630.332.62.24.5
EBITDA 2.5 B1.9 B287 M
Depreciation 2.4 B2.1 B462.8 M
Tax 98.2 M178.8 M124.1 M96.7 M83 M77 M90 M71.7 M74.5 M366,000
Net profit (636.8 M)1.7 B668.2 M134.7 M(1.2 B)(44.7 M)(346.4 M)(772.3 M)(250.3 M)(14.6 M)
EPS (0.83)(0.03)(0.23)(0.52)
Balance Sheet
Equity Share Capital (B)1515.713.912.912.81414.114.415.215.5
Retained Earnings (2.2 B)(1 B)(955.8 M)(609.4 M)162.9 M413.1 M
Total Debt (B)2729.129.129.7
Total Assets (B)35.340.740.340.742.245.245.946.946.743.5
Current Asset (B)5.89.57.14.667.46.46.23.52.4
Fixed Asset (B)29.4313334.135.537.338.940.341.740.6
Working Capital 2.9 B6.2 B3.8 B1.1 B1.7 B3.5 B2.1 B2.4 B1.1 B(29.6 M)
Cash Flow
Operating Cash Flow 3.6 B2.8 B2.2 B1.4 B1.1 B(18.4 M)
Investing Cash Flow (905.3 M)(638 M)(770.1 M)(1.4 B)(1.2 B)(2.3 M)(13.1 M)
Financing Cash Flow (1.6 B)65.2 M(4.6 M)(328.4 M)170.2 M
Net Cash Flow 1.1 B2.3 B1.4 B(300 M)100.1 M

SECTION 9 Peer Group Analysis & Ranking

9.1 BuySellSignals Fundamentals Valuation Ranking: Saudi Kayan Petrochemical vs Saudi Market

Out of 176 stocks in the Saudi Arabian Market, Saudi Kayan Petrochemical is ranked fifteenth by Price/Net Tangible Assets, Twenty-ninth by Revenue, Thirty-eighth by Discount to 52-Wk High and Eighty-seventh by Premium to 52-Wk Low.

Saudi Avg2350RankRank 1Rank 2Rank 3Lowest Rank
Price/Net Tangible Assets10.8x0.9x150.4x 43000.5x 10200.6x 4333-
Revenue SAR8.4 B1.2 B29 33.9 B 201033.1 B 7010
Discount to 52-Wk High (%)14.232.953862.4 216058.4 121348.2 21101.2 2050
Premium to 52-Wk Low (%)21.827.8875.4 20808.5 41009.2 8140383.6 9502
EBITDA Margin-(5.6)11485.4 203079.5 413078.3 4292(56.8) 4020
P/Sales-19.3x1190.4x 21600.6x 40800.9x 7200-
Net Profit2.2 billion(636.8 M)185330.7 B 222211.4 B 118010.7 B 7010(1.6 B) 2060

Negative values are shown in brackets.

9.2 Market Share

Saudi Kayan Petrochemical vs Petrochemical Industries sector [Petrochemical Industries sector Total in Brackets]

Revenue of SAR1.2 billion (US$316.5 million)[2.4% of aggregate sector revenue of SAR49.3 billion; down from 4.2% in the previous year.]

9.3 Global Rank [out of 47,314 stocks] and Rank of Saudi Kayan Petrochemical in the Middle East & Africa Region [out of 2,222 stocks]

DescriptionValueGlobal RankIn MEA Region
MCap (US$)3.5B3,271114
Total Assets (US$)9.4B2,928116
Revenue (US$)316.5M12,068356
Net Profit (US$)(169.8M)42,5711,817
Return on Equity %(4.3)30,8741,490
Net Profit Margin %(6.7)30,8271,414
Price to Book0.813,784783
PV1000 (1Year) USD*73129,2801,451
US$* Change (1Year) %-29.928,7851,415

* 1 year ago USD 1 = SAR 3.75

Jun 01, 2020: USD 1 equals SAR 3.75

9.4 Rank of Saudi Kayan Petrochemical in the All Share Index (TASI) [out of 171 stocks], in the Total Saudi Market [out of 176 stocks] and in the Petrochemical industries sector [out of 12 stocks]

DescriptionValueIn All Share Index (TASI)In Total Saudi MarketIn Petrochemical industries sector
MCap (SAR)13B24244
Total Assets (SAR)35.3B20203
Revenue (SAR)1.2B28299
Net Profit (SAR)(636.8M)17118111
Return on Equity %(4.3)1251339
Net Profit Margin %(6.7)13614510
Price to Book0.914152
PV1000 (1Year) SAR73115716310

SECTION 10 News Archives (Dec 2018 - Sep 2019)

10.1 Press Releases

September 18 2019: Saudi Kayan Petrochemical Co. Announces a curtailment of feedstock supplies to the company plants.

Saudi Kayan Petrochemical Company (Saudi Kayan) announces a curtailment of feedstock supplies to the company plants of approximately 50% starting from Saturday 14th September 2019. The company is currently working on evaluating the final effects to determine the financial impact. Any developments in this regard will be disclosed accordance with the relevant procedures and regulations.

Source: mubasher.info

September 18 2019: Addendum Announcement from Saudi Kayan Petrochemical Co in regards to a acurtailment of feedstock supplies to the company plants.

Following the announcement of the Saudi Kayan Petrochemical Company on Tadawul website on September 15, 2019 regarding a curtailment of feedstock supplies to the company plants.

Source: FPT Securities

December 20 2018: Saudi Kayan Petrochemical Co. announces signing a Memorandum of Understanding with Clariant International AG

Signing of a Memorandum of understanding (MoU) with Clariant International AG. The Memorandum sets out the main principles of cooperation between the two parties in evaluating the feasibility study for the establishment of a joint venture company owns a plant located within Saudi Kayan Petrochemical Company complex in Jubail Industrial City for the manufacturing Alkoxylates, with a production capacity 120 KTA, utilizing the materials produced by the Saudi Kayan.

Source: mubasher.info

Glossary

ADVT: Average Daily Volume of shares Traded

Annual Return: Dividends Paid In a 12-Month Period/Price at the Beginning of the Period + Capital Gain or Loss over 1 Year/Price 1 Year Ago (%)

Current Ratio: Current Assets/Current Liabiliites (times)

EBIT Margin : Earnings Before Interest and Tax/Revenue (%)

Moving Average Price (n periods): Sum of Prices for each Period/Number of Periods

PV1000: Present value of 1000 invested 1 year/'n' years ago

Price Close/Moving Avg Price: Latest Price/Moving Average Price

Price/NTA: Closing Share Price/Net Tangible Assets Per Share (times)

Relative Price Change [RPC]: Relative price change is price change of stock with respect to Benchmark Index

Relative Strength (6 Months): Price close today/Price close 6 months ago, then ranked by percentile within the entire market.

Return on Equity (Shareholders' Funds): Net Profit/Net Assets (%)

TSR: Total Shareholder Returns is expressed as an annualized rate of return for shareholders after allowing for capital appreciation and dividend

Volatility: Highest Price minus Lowest Price/Lowest Price (%)

Volume Index (VI): Number of shares traded in the period/Average number of shares traded for the period

Volume Weighted Average Price (VWAP): The Volume Weighted Average Price (VWAP) is the summation of turnover divided by total volume in the same period.

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