12/05/2025

BIZ & FINANCE MONDAY | MAY 12, 2025

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Aramco reports near 5% drop in Q1 profit

‘Pragmatic’ approach could reap UK-EU deal: Starmer LONDON: A “pragmatic” approach to talks on food standards, youth mobility and European courts could yield an “ambitious” post-Brexit deal between the EU and UK, Prime Minister Keir Starmer said in an interview published on Saturday by The Guardian newspaper. London and Brussels are hopeful of signing a deal at the first UK-EU summit since Brexit, which will take place in the British capital on May 19. However, Labour’s drubbing by the anti-EU Reform UK party in recent local elections and critical reaction to a trade deal agreed this week with India could lead London to take a more cautious approach, The Guardian reported. Despite the potential for domestic criticism, Starmer suggested to the paper that the UK was prepared to align with the EU on food standards as part of the deal, saying: “We do not want to lower our standards on food. “I think that British people are proud of the high standards that we have, and we want to maintain those standards,”he said, adding the government would take a “serious, pragmatic” approach to talks. Significantly, he accepted that the European Court of Justice would be involved in resolving disputes, pointing out that it already has a role as part of the existing agreement that deals with Northern Ireland. Defence Secretary John Healey also told the BBC on Friday that London was willing to pay for UK companies to gain access to lucrative EU defence spending programmes. “We are prepared to pay our fair share but we want to have a say in the programmes, while retaining UK intellectual property and export opportunities,” he said. One of the most controversial elements of a new deal is a potential youth mobility scheme, which would remove restrictions on young people moving between the UK and EU. Minister for EU Relations Nick Thomas-Symonds said this week the government was exploring the scheme, and Starmer, when asked about the subject, told The Guardian that “we’re pragmatists, and that’s the approach that we bring to these negotiations”. Immigration was a key reason behind the 2016 vote to leave the European Union and the government has vowed there will be no return to free of movement of people. The newspaper said EU diplomats were concerned that domestic concerns were curbing London’s desire for a quick deal, with one saying that “everyone is very sensitive to how a closer relationship lands in the UK”. – AFP

RIYADH: Saudi oil giant Aramco reported a 4.6% drop in first-quarter profit yesterday due to lower sales and higher operating costs. The world’s top oil exporter reported net profit of 97.54 billion riyals (RM111.8 billion) in the three months ended March 31, which beat a company-provided median estimate from 16 analysts of US$25.36 billion (RM109 billion). Aramco confirmed total dividends of US$21.36 billion for the first quarter, US$219 million of which was performance-linked dividends, a mechanism introduced after a windfall from oil prices in 2022 following Russia’s invasion of Ukraine. The oil giant has long been a cash cow for the Saudi state. Oil generated 62% of government revenue last year and the International Monetary Fund has estimated Saudi Arabia needs oil at US$92.3 this year to balance its budget. The results were released before US President Donald Trump’s visit to the kingdom tomorrow. His trade war with China has spooked global markets and sent crude prices tumbling amid fears of a global economic slowdown. Global crude benchmark Brent has been on a largely downward trajectory since a 2025 high of US$82.03 in January. It closed at US$63.91 on Friday. Aramco had said in March it expected to declare total dividends of US$85.4 billion in 2025, down sharply from last year’s payout of over US$124 billion, which was based on 2023 and 2024 earnings. The performance-linked payout, which last year totalled US$43.1 billion, was slashed roughly 98% as free cash flow dried up. The Saudi government directly owns roughly 81.5% of Aramco, while its sovereign wealth fund PIF controls an additional 16% stake. It also leans on the group’s payouts to invest in other sectors as it tries to diversify the economy away from oil. Diversification efforts include o Performance-linked dividends cut by 98% as free cash flow dries up

Aramco’s oil field in the Empty Quarter, Saudi Arabia. – REUTERSPIC

“In volatile times Aramco’s resilience underpins both our financial performance and our sustainable and progressive base dividend.” Capital expenditure (capex) was just over US$12.5 billion in the first quarter, up 15.9% from a year before. Aramco had outlined capital investments, which includes capex and external investments, of between US$52 billion and US$58 billion. Capex was US$50.4 billion last year. – Reuters

US$19.2 billion in the first quarter, down 15.8% from a year ago. “Global trade dynamics affected energy markets in the first quarter of 2025, with economic uncertainty impacting oil prices,” chief executive Amin Nasser said in a statement, adding Aramco’s results showed the value of its low-cost operations. “Such periods also highlight the importance of disciplined capital planning and execution while we continue to take a long-term view.

building or renovating 15 stadiums for the 2034 World Cup, the most high-profile of several showpiece events the kingdom will host in coming years. Amid lower oil prices, the kingdom has scaled back some lofty ambitions to prioritise completing projects essential to hosting global sporting events over the next decade as rising costs weigh, sources told Reuters in November. Aramco’s free cash flow was

BMS and Sanofi to pay Hawaii US$700 million to settle Plavix lawsuit LOS ANGELES: US state Hawaii announced last week it had accepted a US$700 million (RM3 billion) settlement in its case against US pharmaceutical company Bristol Myers Squibb (BMS) and subsidiaries of French drug group Sanofi over the blood thinner Plavix. been in courts for more than a decade. “This landmark settlement is a major victory for the state of Hawaii,” governor Josh Green said. pay equal shares of the settlement by June 9, bringing an end to 12 years of litigation, according to legal filings. Per media reports, the pharma giants lost in court repeatedly and continually appealed. “It doesn’t matter if a company is a one-person shop or a The state had pointed to results showing the treatment did not work well for some patients of Asian or Pacific Island descent who could not properly metabolize the drug. consumer protection laws,“ the state’s attorney general Anne Lopez said.

“Once the money goes into our general fund, we can go to work on immediately identifying ways to enhance health care services for Hawaii’s residents,” he added. BMS and Sanofi have agreed to

Plavix, known as clopidogrel, is an anti-platelet medicine used to reduce the risk of heart attack or strokes. – AFP

The state alleged the companies misled consumers about the benefit of using the drug, in a case that has

multi-billion-dollar oil company, we will relentlessly enforce Hawaii’s

Egyptian inflation climbs to 13.9% in April

time high of 33.9% at the end of February, central bank data showed. Egypt devalued its currency, raised interest rates by 600 basis points and signed an US$8 billion financial support package with the International Monetary Fund in March last year, helping to bring its finances under control. – Reuters

full-scale invasion of Ukraine in early 2022, which prompted foreign investors to withdraw billions of dollars from Egyptian treasuries. Headline inflation rose by a record 38.0% in September 2023. M2 money supply expanded in the year to end-March, but at a slower rate, dropping to 25.8% from an all

Food and beverage prices decelerated by 1.5%. Annually, food and beverage prices rose by 6.0%. The median forecast of analysts polled by Reuters was for annual inflation to have climbed to 13.9%. They cited an increase in the official price of fuel as the main cause. Inflation soared following Russia’s

CAIRO: urban consumer price inflation accelerated to 13.9% in April from 13.6% in March, matching analyst expectations, data from statistics agency CAPMAS showed on Saturday. Month on month, prices were 1.5% higher at the end of April than at end-March. Egypt’s annual