Borouge Reports $281 Million Q1 2025 Profit Amid Strategic Expansion and Merger Developments
Borouge Plc, the Abu Dhabi-based petrochemical joint venture between ADNOC and Austria’s Borealis, announced a net profit of $281 million for the first quarter of 2025. This performance underscores the company’s strategic focus on high-value polyolefin products and operational efficiency.
Company Overview
Established in 1998, Borouge is a leading provider of innovative polyolefin solutions, including polyethylene and polypropylene. The company operates through two primary entities: Abu Dhabi Polymers Co. Ltd (Borouge), based in Abu Dhabi, and Borouge Pte Ltd, headquartered in Singapore. With a workforce exceeding 3,100 employees, Borouge serves markets across the Middle East, Asia Pacific, and Africa.
Financial Performance
In Q1 2025, Borouge reported a net profit of $281 million, reflecting its robust operational strategies and market demand for premium polyolefin products. The company’s commitment to cost optimization and product innovation has contributed to its financial resilience.
Strategic Merger: Formation of Borouge Group International
In March 2025, ADNOC and OMV announced plans to merge their respective petrochemical assets—Borouge and Borealis—into a new entity named Borouge Group International. This merger, valued at approximately $60 billion, aims to create the world’s fourth-largest polyolefins company. The new entity will also acquire Canada’s Nova Chemicals for $13.4 billion, enhancing its footprint in North America. The merger is expected to complete in Q1 2026, pending regulatory approvals.
Product Portfolio and Technological Innovations
Borouge’s product offerings encompass a wide range of applications, including:
- Infrastructure: Pipes and fittings for water and gas distribution.
- Energy: Cable insulation materials for power transmission.
- Healthcare: Medical-grade polymers for packaging and devices.
- Agriculture: Greenhouse films and irrigation systems.
- Packaging: Advanced materials for food and consumer goods.
The company leverages proprietary technologies such as Borstar® to produce high-performance polymers, meeting the evolving demands of various industries.
Expansion Projects
Borouge is progressing with its Borouge 4 expansion project, which is over 60% complete as of Q1 2024. Upon completion, the facility will increase the company’s annual production capacity by 28%, solidifying its position as the world’s largest integrated single-site polyolefin complex.
Additionally, Borouge, in collaboration with ADNOC, Borealis, and China’s Wanhua Chemical Group, has initiated a feasibility study for a new polyolefins complex in Fuzhou, China. The proposed facility aims to produce 1.6 million tons per year of specialty polyolefins, utilizing 100% zero-carbon electricity, underscoring the company’s commitment to sustainability.
Strategic Focus on High-Value Products
Borouge’s emphasis on premium polyolefin solutions, particularly in sectors like infrastructure, energy, agriculture, specialty packaging, and healthcare, has yielded substantial benefits. In Q1 2024, the company achieved a polyethylene price premium of $222 per tonne, a 19% increase from the previous quarter, and a polypropylene premium of $162 per tonne, up 46% quarter-on-quarter.
Operational Excellence and Cost Efficiency
The company’s commitment to operational excellence is evident in its cost management strategies. Borouge reduced its overall cost base by 20% year-on-year to $739 million in Q1 2024. This efficiency contributed to an industry-leading EBITDA margin of 44%, up from 40% in the previous quarter.
Reflecting confidence in its financial stability, Borouge reaffirmed its intention to maintain a $1.3 billion dividend for the 2024 financial year, representing a current dividend yield of 6.5%.
Outlook
Borouge’s strategic initiatives, including its focus on high-value products, technological innovation, and global expansion, position the company for sustained growth in the evolving petrochemical landscape. The impending merger to form Borouge Group International is expected to enhance its global presence and operational synergies, further solidifying its market leadership.
