The Saudi Arabian Oil Company (Aramco) issued its full-year 2023 financial results, reporting a net income of SAR454.8 billion ($121.3 billion), its second-highest ever net income.
According to an Aramco press release, the results, underpinned by Aramco’s unique operational flexibility, reliability and low-cost production base, reflect the company’s ongoing commitment to creating value for its shareholders.
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#aramco 2023 financial results represent our second highest ever net income and are underpinned by our unique operational flexibility, reliability, and ongoing commitment to creating value for our shareholders
Learn more 👇https://t.co/jiOZKl2isI
#AramcoResults pic.twitter.com/Ksa9dkWgnU— aramco (@aramco) March 10, 2024
Aramco’s net income was $121.3 billion in 2023, compared to $161.1 billion in 2022. The year-on-year decrease can be attributed to lower crude oil prices and volumes sold, as well as to reduced refining and chemicals margins, partially offset by a decrease in production royalties during the year and lower income taxes and zakat.
Free cash flow reached $101.2 billion in 2023, compared to $148.5 billion in 2022. Aramco’s balance sheet remains strong and its gearing ratio at the end of 2023 was -6.3 percent, compared to -7.9 percent at the end of 2022.
Total dividends
Total dividends of $97.8 billion were paid in 2023, up 30 percent from 2022. Aramco declared a base dividend of $20.3 billion for the fourth quarter, to be paid in Q1 2024. In addition, the board approved the third distribution of performance-linked dividends in the amount of $10.8 billion.
In August 2023, the company announced its intention to calculate the first performance-linked dividends based on the combined full-year results of 2022 and 2023, to be distributed over six quarters, starting from the third quarter of 2023. The full year performance-linked dividend to be paid in 2024 is expected to be $43.1 billion, including the $10.8 billion in Q1, based on the previously announced mechanism and subject to board approval.
Capital investments
Capital investments in 2023 reached $49.7 billion, including $42.2 billion organic capex. This represents a 28 percent increase from capital investments of $38.8 billion in 2022, including $37.6 billion organic capex.
Aramco expects 2024 capital investments to be approximately $48 to $58 billion, growing until around the middle of the decade. The directive to maintain maximum sustainable capacity at 12 million barrels per day, mainly from deferral of projects not yet commissioned and reductions in infill drilling, is expected to reduce capital investment by approximately $40 billion between 2024 and 2028.
Operational highlights
In 2023, Aramco’s average hydrocarbon production was 12.8 million barrels of oil equivalent per day (MMboed), including 10.7 million barrels per day (MMbpd) of total liquids.
Aramco continued its strong track record of supply reliability, by delivering crude oil and other products with 99.8 percent reliability in 2023.
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