Aramco Hits Strong Fiscal-Year Results; Ramps Up Capital Spending, Pays Special Dividend

Aramco reported net income of $32.4 billion during the fourth quarter and $110.0 billion for full-year 2021 compared with $14.0 billion and $49.0 billion, respectively, the year before on higher oil prices and volumes, stronger refining and chemical margins, and inclusion of SABIC’s full-year results. Free cash flow increased to $107.5 billion in 2021 compared with $49.1 billion the year before, which more than covered the full-year dividend of $75.0 billion declared for 2021. Stronger cash flow generation during 2021 resulted in net debt and gearing falling to $56.4 billion and 14.2%, respectively, from a net debt of $87.7 billion and gearing of 23.0% at year-end 2020. Additionally, Aramco plans to pay out a special dividend of $4 billion in excess cash. The regular dividend component amounts to $0.38 per share, while the special dividend equals $0.02 per share. The combined $0.40 per share dividend lags peers that have announced additional share repurchases and dividend hikes.