Saudi Aramco shares and their distribution methods for the year 2024
Riyadh – Mubasher: Executive Vice President and Chief Financial Officer of Saudi Aramco, Ziad Al-Morshed, said that the aim of the new mechanism adopted for additional cash distributions linked to the company’s financial performance is to share more profits with shareholders
interview with Al-Arabiya, that the company’s basic distribution policy will continue beyond 2024, along with the mechanism of additional distributions.
He explained that Aramco’s priorities for allocating cash flows are clear and have not changed since the initial offering,
and start with maintaining capital spending for business sustainability, then maintaining a sustainable and growing dividend distribution, then reducing the debt ratio, or distributing additional profits.
He explained that Aramco’s priorities for allocating cash flows are clear and have not changed since the initial offering, and start with maintaining capital spending for business sustainability,
then maintaining a sustainable and growing dividend distribution, then reducing the debt ratio, or distributing additional profits.
He continued, “In the past two years, we have significantly reduced the indebtedness ratio, and currently we focus on distributions, and the increase in them comes in two types: first, the increase in basic distributions, which we have always said will be sustainable and growing, and secondly, additional distributions.”
Al-Murshid said, “We increased basic distributions in the fourth quarter of last year by 4%, to 73 billion riyals, and we maintained this level of basic distributions in the first quarter of 2023.”
He stated that Aramco has proven its ability to distribute sustainable profits even in the most severe times of the economic situation during the pandemic, and also increase them by 4% in the fourth quarter of last year and maintain them also in the first quarter of this year.
Al-Murshid explained that performance-related distributions are not related to a specific oil price,
and are specifically related to free cash flows, and we aim to range from 50 to 70% of annual free cash flows, after deducting basic dividends.
He pointed out that Aramco intends to distribute performance-related profits on a quarterly basis.
He said that the basic and additional distributions related to performance are left to the discretion of Aramco’s board of directors, which takes into account
the company’s financial position and its ability to finance its obligations, including capital growth plans. In accordance with the company’s declared dividend policy.
And Al-Murshid indicated that the company has one type of shares,
and therefore all shareholders are treated in one way, whether the state institutions contributing to Aramco from
the Public Investment Fund, the “Sanabel” Investment Company
and other shareholders, and the profits are distributed to all shareholders with the same eligibility.
Saudi Aramco, on May 9, announced the adoption of a performance-related dividend distribution mechanism, in addition to the sustainable and increasing basic profits that the company is currently distributing and intends to maintain. To trade and invest in the Gulf stock exchanges,
Aramco President: Strong cash flows in the first quarter and strengthening the company’s financial position
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