Saudi Aramco is world's most profitable company, beating Apple by far

[NEW YORK] The earnings of Saudi Aramco, Saudi Arabia's giant oil company, have long been a mystery because the company is owned by a government that has kept the information under wraps. But on Monday, Aramco opened its books, revealing that the company generated US$111.1 billion last year, making it probably the world's most profitable company by far.

It handily beat Apple (US$59.5 billion in net income in 2018) and Alphabet, the parent company of Google (US$30.7 billion), and ran laps around other oil companies like Royal Dutch Shell (US$23.9 billion) and Exxon Mobil (US$20.8 billion).

Saudi Aramco issued the financial data because it is preparing to borrow up to US$15 billion in bonds in what could be a more aggressive approach to capital-raising for the company and for Saudi Arabia.

Aramco wants the money to help finance its purchase, announced Friday, of most of Saudi Basic Industries, a major petrochemical company known as Sabic, for about US$69 billion. Aramco will be buying the stake from Saudi Arabia's sovereign wealth fund, whose chairman is Crown Prince Mohammed bin Salman.

The crown prince, who is the kingdom's main economic policymaker, wants to ease the economy's dependence on oil and gas revenue through investments in technology companies like Uber. A planned offering of part of Aramco - which would have been the largest initial public offering on record - was expected to raise money for that purpose. That IPO was postponed last year, and the issuing of bonds appears to be an alternative way to raise money.

Aramco also appears to be trying to make itself into a broader energy company and, thus, more attractive if the government decides once again to try to sell a slice of the company.

Aramco's chief executive, Amin Nasser, has said that the company is pursuing international acquisitions in areas like liquefied natural gas, a chilled fuel that can be transported globally on ships like oil.

For investors, one persistent concern about Aramco is its ties to the Saudi government.

"Unlike Exxon and Chevron, its revenue streams are highly dependent on a single country that could face real instability risks," Ayham Kamel, an analyst at Eurasia Group, a consulting firm, wrote in a recent note to clients.

But analysts said that the numbers revealed Monday showed that Aramco had plenty of firepower for more deals.

NYTIMES