Saudi Aramco sees lower 2025 dividends as profit drops

Investing.com -- The world’s largest oil company Saudi Aramco (TADAWUL:2222) said on Tuesday that it expects total dividends of $85.4 billion to be declared in 2025, compared to approximately $124.25 billion last year.

The oil giant reported a 12.4% decline in full-year 2024 net income to $106.2 billion, down from $121.3 billion in 2023. 

Aramco's cash flow from operating activities fell to $135.7 billion in 2024, compared to $143.4 billion the previous year. Free cash flow decreased to $85.3 billion from $101.2 billion in 2023.

The company's gearing ratio, a measure of debt to equity, rose to 4.5% at the end of 2024 from -6.3% at the end of 2023.

Aramco's board also declared a base dividend of $21.1 billion for the fourth quarter, representing a 4.2% YoY increase. The company also announced a performance-linked dividend of $0.2 billion, both to be paid in the first quarter of 2025.

Capital investment for 2024 totaled $53.3 billion, including $50.4 billion in organic capital expenditure. The company provided 2025 capital investment guidance of $52.0 billion to $58.0 billion, excluding approximately $4.0 billion of project financing.

Aramco reported that global oil demand reached new highs in 2024 and expects further growth in 2025. The company emphasized its ability to utilize one million barrels per day of existing spare capacity, which could generate an additional $12.0 billion in operating cash flow based on 2024's average price.