Aramco Earnings: Earnings Fall but Dividend Raised as Lower Capex Expected Without Capacity Growth

Aramco reported net income of $121.3 billion in 2023 compared with $161.1 billion the year prior due to lower oil prices and volumes as well as weaker refining and chemical margins. Total hydrocarbon volumes decreased to 12.8 million barrels of oil equivalent per day from 13.6 mmboe/d in 2022. Despite the decline in earnings, management increased the base quarterly dividend to $20.3 billion for the fourth quarter of 2023, to be paid in the first quarter of 2024. The firm will also pay a full-year performance-linked dividend for the second straight year, expected to be $43.1 billion in 2024, of which $10.8 billion will be paid in the first quarter. The regular quarterly and performance dividends imply a forward yield of 6.0%, bringing the payout more in line with peers.