Saudi Arabian Fertilizers Co. (Safco) beat profit forecasts in the second quarter as the affiliate of Saudi Basic Industries Corp (SABIC) boosted production and a world food crisis spurred fertilizer prices. Safco's near 125-percent surge in profit in the three months to June 30 would reflect positively on the earnings of SABIC, the world's biggest chemicals firm by market value, its chief executive said. “The increase in productivity in the factories was good in the second quarter compared with the first quarter,” Mohamed Al-Mady, chief executive officer of SABIC and Safco, said in an interview with Al-Arabiya Television. “But more important than this was the increase in prices which is due to the rise in global oil prices and the increase in the demand for food,” Mady said. Safco, in which SABIC owns a 42 percent stake, made a profit of SR1.19 billion ($317.6 million) in the three months ending June 30, up from 530.3 million riyals a year earlier. The rise resulted from “improvement in the selling price of core products and the volume of sales”, Safco said in a statement on the bourse website, without giving details. Mady said fertiliser prices rose 20 to 25 percent in the second quarter as oil prices - which have more than doubled in the last year - surged to levels above $140 a barrel by the end of June. The quarterly earnings were 12.3 percent higher than the best of three forecasts last month, signaling that SABIC could also outpace expectations in the quarter.
