BRIEF-Saudi Aramco Says Q1 Profit Falls

SAUDI ARABIAN OIL CO (SAUDI ARAMCO) : * Q1 NET PROFIT AFTER ZAKAT AND TAX 62.48 BILLION RIYALS VERSUS 83.29 BILLION RIYALS YEAR AGO

* Q1 SALES 225.57 BILLION RIYALS VERSUS 269.3 BILLION RIYALS YEAR AGO * DIVIDENDS OF $18.75 BILLION FOR THE FIRST QUARTER OF 2020 ARE THE HIGHEST OF ANY LISTED COMPANY WORLDWIDE AND WILL BE PAID IN THE SECOND QUARTER.

* Q1 NET INCOME $16.66 BILLION * FIRST QUARTER CAPITAL EXPENDITURES WERE $7.4 BILLION, COMPARED TO $7.2 BILLION FOR THE SAME PERIOD IN 2019

* RETAIN SIGNIFICANT FLEXIBILITY TO FURTHER ADJUST EXPENDITURES IN RESPONSE TO THE DISRUPTION CAUSED BY THE CORONAVIRUS * IN LIGHT OF MARKET CONDITIONS AND RECENT COMMODITY PRICE VOLATILITY, THE COMPANY CONTINUES TO EXPECT CAPITAL SPENDING FOR 2020 TO BE BETWEEN $25 BILLION AND $30 BILLION

* Q1 SAW LOWER CRUDE OIL PRICES, AS WELL AS DECLINING REFINING AND CHEMICALS MARGINS AND INVENTORY RE-MEASUREMENT LOSSES * CAPITAL EXPENDITURES FOR 2021 AND BEYOND REMAIN UNDER REVIEW

* CASH FLOW FROM OPERATING ACTIVITIES WAS STRONG AT $22.4 BILLION IN THE FIRST QUARTER, COMPARED TO $24.5 BILLION IN THE SAME PERIOD OF 2019 * IMPACT OF DECLINING CRUDE OIL PRICES AND REFINING AND CHEMICALS MARGINS WAS PARTIALLY OFFSET BY FAVORABLE MOVEMENTS IN WORKING CAPITAL.

* FREE CASH FLOW WAS ROBUST AT $15.0 BILLION IN THE FIRST QUARTER, COMPARED TO $17.4 BILLION IN THE SAME PERIOD LAST YEAR * COMPANY CONTINUES TO UTILIZE INBUILT SYSTEMS FOR MANAGING GLOBAL CRISES TO CONTINUE DELIVERING ENERGY TO CUSTOMERS

* NET INCOME REMAINED ROBUST AT $16.7 BILLION FOR THE FIRST QUARTER, DESPITE LOWER CRUDE OIL PRICES AS WELL AS DECLINING REFINING AND CHEMICALS MARGINS AND INVENTORY RE-MEASUREMENT LOSSES * BALANCE SHEET REMAINS STRONG AND GEARING RATIO DECREASED FROM -0.2% ON DECEMBER 31, 2019 TO -4.9% ON MARCH 31, 2020

* Q1 CRUDE OIL PRODUCTION (MMBPD) 9.8 * Q1 GROSS REFINING CAPACITY (MMBPD) 6.4

* Q1 FIRST QUARTER NET INCOME $16.7 BILLION * FIRST QUARTER FREE CASH FLOW $15.0 BILLION

* DIVIDENDS OF $13.4 BILLION PAID IN THE FIRST QUARTER, IN RESPECT OF Q4 2019 * DIVIDENDS OF $18.75 BILLION TO BE PAID IN THE SECOND QUARTER, FOR Q1 2020

* GEARING RATIO OF -4.9% REFLECTS FURTHER STRENGTHENING OF BALANCE SHEET * LOW UPSTREAM COSTS AND SUSTAINING CAPITAL PROVIDE SIGNIFICANT FLEXIBILITY

* SAUDI ARAMCO CEO- DURING THE FIRST QUARTER, WE TOOK STEPS TO FURTHER OPTIMIZE OUR PLANNED 2020 CAPITAL SPENDING * SAUDI ARAMCO CEO - IDENTIFIED OPPORTUNITIES TO IMPROVE OPERATIONAL PRODUCTIVITY

* SAUDI ARAMCO CEO - LOOKING AHEAD TO REMAINDER OF 2020, WE EXPECT THE IMPACT OF COVID-19 PANDEMIC ON GLOBAL ENERGY DEMAND AND OIL PRICES TO WEIGH ON OUR EARNINGS * THROUGH ITS WHOLLY OWNED SUBSIDIARY ARAMCO GULF OPERATIONS COMPANY LTD. (AGOC), RESUMED OPERATIONS AT AL-KHAFJI JOINT OPERATIONS (KJO). AGOC OPERATES IN THE OFFSHORE PARTITIONED TERRITORY BETWEEN SAUDI ARABIA AND THE STATE OF KUWAIT, WITH A 50% OWNERSHIP IN KJO

* SAUDI ARAMCO CEO - WE CONTINUE TO REINFORCE THE BUSINESS DURING THIS PERIOD BY REDUCING OUR CAPEX AND DRIVING OPERATIONAL EXCELLENCE * UNDER CHALLENGING MARKET CONDITIONS, ARAMCO MAINTAINED ITS PRE-EMINENCE IN OIL AND GAS PRODUCTION

* ARAMCO TRADING COMPANY SIGNED AN AGREEMENT TO OFFTAKE ARAMCO GULF OPERATIONS COMPANY’S FULL SHARE OF CRUDE OIL PRODUCTION FOLLOWING THE RESTART OF KJO * DURING Q1 FADHILI GAS PLANT INCREASED ITS PROCESSING CAPACITY FROM 1.5 BILLION STANDARD CUBIC FEET PER DAY (BSCFD) AT YEAR-END 2019 TO REACH 2.0 BSCFD DURING Q1 2020

* ARAMCO CEO - COVID-19 CRISIS IS UNLIKE ANYTHING WORLD HAS EXPERIENCED IN RECENT HISTORY AND WE ARE ADAPTING TO A HIGHLY COMPLEX AND RAPIDLY CHANGING BUSINESS ENVIRONMENT * PROGRESS REMAINS ON TRACK AND THE PLANT IS EXPECTED TO REACH FULL CAPACITY OF 2.5 BSCFD THIS YEAR

* DESPITE A CHALLENGING MARKET ENVIRONMENT, DOWNSTREAM BUSINESS IS KEEPING PACE WITH ITS LONG-TERM STRATEGY TO CAPTURE VALUE ACROSS HYDROCARBON VALUE CHAIN THROUGH FURTHER STRATEGIC INTEGRATION AND DIVERSIFICATION OF ITS OPERATIONS * THE FADHILI GAS PLANT INCREASED ITS PROCESSING CAPACITY FROM 1.5 BSCFD AT YEAR-END 2019 TO REACH 2.0 BSCFD DURING FIRST QUARTER OF 2020

* MANAGEMENT CONTINUES TO MONITOR COVID-19 SITUATION AND WILL TAKE FURTHER ACTIONS AS NECESSARY AND APPROPRIATE * PROGRESS REMAINS ON TRACK AND THE FADHILI GAS PLANT IS EXPECTED TO REACH ITS FULL CAPACITY OF 2.5 BSCFD DURING THE YEAR

* Q1 RESULTS WAS IMPACTED BY DECLINING GLOBAL CRUDE OIL DEMAND RESULTING FROM COVID-19 AND ITS IMPACT ON WORLDWIDE ECONOMIC ACTIVITY Source text for Eikon: Further company coverage: