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Saudi Arabia’s state-run oil company Saudi Aramco has announced a new financial first for the giant: it will hold its very first earnings call in August revealing to the world its H1 2019 results, according to Arabian Business.
Aramco first shed some light on a few of its financial figures that have been shrouded in secrecy forever. In January Aramco shared its independent audit results of its massive oil reserves. A few months later, Aramco shared its bond prospectus that revealed its staggering 2018 profit figure of $111 billion, making it the world’s most profitable firm—if the figure provided is accurate.
Saudi Aramco’s privacy in relation to its financial information came to light when it announced it would publicly list a portion of its company on a stock exchange to be named later. However, the lack of transparency in its data has proven to be a solid stumbling block. The IPO was subsequently delayed, with some industry experts guessing that it would never happen at all.
The most recent information on the IPO came in March from Saudi Energy Minister Khalid al-Falih, who said that the IPO was on track to take place in 2021. The earnings call announcement may be another necessary step in the IPO process designed to appease the public.
The international bond that Aramco offered earlier this year was a success despite the lack of the usual transparency with these deals.
With or without the IPO, Aramco is moving towards being an international player, and improved transparency will be a must.
“We are no longer going to be inward-looking and focused only on monetising the kingdom’s resources. Going forward the world is going to be Saudi Aramco’s playground,” Al-Falih told the Financial Times in February. “If I have investors from New York or London or Tokyo that are investing in Saudi Aramco they want Saudi Aramco to be competing with the world’s best international oil companies,” Al-Falih also said at the time.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group.