Saudi industrial in profits fall

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Saudi Basic Industries Corp (Sabic) has seen fourth quarter profits drop more than forecast, after demand slowed.

Profit for the three months to December 31 dropped to 311m riyals ($83m; £59.4m), down 95% year-on-year.

The firm, which produces chemicals, fertilisers, plastics and metals, said it would stop production at certain plants and reduce the workforce.

Not only has demand for petrochemical fallen, but prices in the sector have also dropped, further denting earnings.

The firm is the largest steel producer in the Gulf.

"These numbers will come as a shock to many investors," said Laurent-Patrick Gally, at investment bank Shuaa Capital.

Firms in the Gulf were thought to be well protected from the downturn, but these latest results underline how the global slowdown is being felt worldwide.

Demand for Sabic's goods have fallen following a slowdown in the automotive, building and construction sectors in particular.

The firm cited a decline in demand as well as the credit crisis as factors hitting earnings.