Invest in Marafiq

Investment Highlights

Investment Highlights

  • The industrial cities in which Marafiq operates enjoy strong support from the National Industrial Development and Logistics Program, which is a key pillar of Saudi Vision 2030.
  • The Industrial cities are set to grow extensively with investments of SAR 100 billion planned by the Royal Commission of Jubail and Yanbu (“RC”) over the next two years. As a key utilities provider in the industrial cities under RC, Marafiq is at the centre of this growth.
  • Jubail is the world's largest industrial city. It is the source of 11% of the Kingdom's non-oil GDP and c.7% of global petrochemical production.
  • Yanbu is the largest refinery hub in the Kingdom, with one-third of the total refinery capacity.
    • Together, Jubail and Yanbu provide 97% of all refined product for export from Saudi Arabia’s ports.
  • Ras Al Khair is a new industrial city dedicated to being a future mining hub in the Kingdom, with a strong strategic link to Jubail's petrochemical industries.
  • Jazan is the Kingdom's centre for heavy industries, with several large-scale projects being developed, including the world's largest titanium smelter.
  • Marafiq's customer base comprises large-scale, highly creditworthy industrial customers, which accounted for 86% of its revenues in FY2021.
  • This strong customer base ensures sufficient and stable demand for utility services and low counterparty credit risk.
  • Marafiq has developed a strong and reliable power and water asset base driven by its strong asset management capabilities. As a result, the Company had over 90% availability of its power, water and gas services.
  • Marafiq also has a young asset fleet – its power assets have an average remaining technical life of 25 years, with water assets having 15-20 years of life left.
  • Marafiq’s largest shareholders are its four founding shareholders - the Public Investment Fund (“PIF”), the Royal Commission for Jubail and Yanbu (“RC”), Saudi Aramco Power Company (“SAPCO”) (a wholly owned subsidiary of the Saudi Arabian Oil Company (Saudi Aramco)), and the Saudi Basic Industries Corporation (“SABIC”) – each of which currently holds 24.81% of Marafiq’s share capital.
  • The presence of the Royal Commission and PIF as its shareholders affirms the strategic importance of Marafiq to the Kingdom.
  • Meanwhile, as well as being supportive shareholders, Aramco and SABIC provide broader support in areas such as governance and benchmarking.
  • Marafiq has a seasoned and entrepreneurial management team with strong operational and technical experience.
  • Marafiq’s strong operational performance underpins its stable financial results.
    • In 2021, Marafiq generated revenue of SAR c.6.2 billion, with adjusted EBITDA of SAR c.2.2 billion and net income of SAR 665 million.
    • The Company’s adjusted EBITDA margin and net income margin were 35% and 10.7% in 2021, respectively.
    • Marafiq’s efficient operations have helped it maintain strong profitability margins with adjusted EBITDA of between SAR 2.0 billion and SAR 2.2 billion over the last three years.
    • The Company has also demonstrated the resilience of its business through the COVID pandemic – in 2020 it only saw a slight dip in revenues (26%) - on the previous year. 2021 saw a return to growth, with revenues up 1.6% to SAR 6.2 billion.
    • Going forward, Marafiq expects both revenue and EBITDA to grow steadily as it continues to expand its operations in the Royal Commission industrial cities, as well as across the Kingdom.
  • The Company has a stable cash-flow profile that is driven by a high free cash flow conversion and a regulated environment with a set tariff system. Marafiq recorded a robust cash flow conversion rate of 75% in 2021. With this strong cash generation profile, the company expects to significantly deleverage in the coming years.
  • The Company’s industrial customer base - some of which have long-term agreements with the company - is reflective in its financial performance, as the degree of stability, combined with a regulated tariffs framework, reduces cash flow volatility.
  • Marafiq’s strong financials led to attractive return on equity for its shareholders of around 10% in FY2021.
  • Marafiq will continue to leverage its existing strong asset base to accelerate its growth in existing areas of operations in Jubail, Yanbu, Ras Al Khair, Jazan and Jeddah.
  • The Company will capitalize on opportunities associated with the Saudi Vision 2030 privatization drive and the continued industrial growth of the Kingdom.
  • Marafiq also plans to enhance its asset utilization rates to increase profitability across all business pillars.
  • Marafiq is committed to focusing on environmental and social issues that will enhance its business model and provide value to all stakeholders.
  • At an operational level, the Company aims to reduce water loss and emissions intensity, as well as optimize its energy usage.
    • In line with the Kingdom's ambitions to lower carbon emissions and replace 1 million barrels per day of liquid fuels with renewables and Gas by 2030, Marafiq has set the target to displace all liquid fuel with gas at Yanbu power generation plants.
    • As part of Marafiq's reuse and sustainability objectives, over 175,000 m³/day of treated water is reused for the irrigation networks across Yanbu and Jubail.
    • Marafiq’s sustainability initiatives are expected to reduce its greenhouse gas emissions intensity by c.25% and result in a c.15% reduction in energy intensity by 2030.

Jubail (Headquarters)
P.O.Box 11133
Jubail Industrial City, 31961, Kingdom of Saudi Arabia

P.O.Box 30144
Yanbu Industrial City, Kingdom of Saudi Arabia

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