Industries Qatar profit takes a hit

Petrochemicals and metals company Industries Qatar blamed weaker commodity prices, new regional capacity and a decline in United States demand through 2009 after posting fourth-quarter net profit below estimates of analysts.

The major company recorded a net profit of QR1.07 billion (Dh1.08bn) for the final three months compared with an average QR1.298bn according to I/B/E/S estimates and QR93.54 million in the fourth quarter of 2008.

Full-year net profit came in at QR4.9bn, the company said yesterday, down 33 per cent from QR7.28bn in 2008, due mainly to falling prices of polyethylene, urea and steel bars.

Industries Qatar is one of many regional petrochemicals companies that have struggled through the downturn although market fundamentals have shown signs of recovery since late last year.

"We are somewhat surprised by Industries Qatar's relatively low earnings, as the fertiliser division did reasonably well in Q4 09 compared to Q3 09, and most petrochemical average prices were up in Q4 09 versus Q3 09," said Laurent-Patrick Gally of Dubai-based investment bank Shuaa Capital.

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