Industries Qatar posts 6.5 pct drop in Q2 net profit

* Q2 net profit 2 bln riyals vs 2.14 bln a year ago

* Falling revenue due to softer petchem prices

* Steel volumes hurt by maintenance outages (Adds detail, quotes)

DOHA, July 29 (Reuters) – Petrochemicals and metals company Industries Qatar (IQ) posted a 6.5 percent dip in second-quarter net profit on Monday, below analysts’ forecasts due to falling petrochemical prices.

The Gulf’s second-largest chemical producer by market value after Saudi Basic Industries Co (SABIC) reported net profit of 2.0 billion riyals ($549.3 million) for the three months ending June 30, compared to 2.14 billion riyals in the same period a year earlier.

Analysts polled by Reuters on average expected the company to post a quarterly profit of 2.3 billion riyals

“The earnings of this reporting period were entirely volume-driven, and came against the backdrop of tighter petrochemical and fertiliser operating margins, with several key product prices at near-term lows,” IQ Chief Coordinator Abdulrahman Ahmad al-Shaibi said in a statement.

Petrochemical prices remain generally weak, with those for most major products below those of the same period in 2012, he added.

Petrochemical revenue for the second quarter fell 9 percent from the previous quarter to 1.1 billion riyals due to weaker prices, as well as moderately weaker volumes following unplanned shutdowns of 15 days and 20 days, the statement said.

First-half steel revenue fell 7.1 percent from the same period last year, while second-quarter steel sales dropped 14.4 percent from the first quarter, a company statement said. Second-quarter volumes were also hurt by a cumulative 52 days of maintenance downtime, it said.

Petrochemical prices have strengthened in recent years, but worries persist over the impact of a global slowdown on industry earnings in the world’s top oil exporting region.

Qatar has embarked on a massive domestic building programme in preparation to host the 2022 World Cup soccer tournament, with plans to spend $11 billion on a new international airport, $5.5 billion on a deepwater seaport and $1 billion for a transport corridor in the capital, Doha.

A year ago, IQ said the steel segment was expected to see “significant benefit from the progressive and wide-ranging infrastructure plans of the State of Qatar.” (Reporting By Regan Doherty, Editing by Praveen Menon and Louise Heavens)

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