Green House Gas emissions reduced by 111kt exceeding our 40kt target.

Innovation

360°

Annual Report 2023

SIPCHEM | ANNUAL REPORT 2023

Contents

SIPCHEM | ANNUAL REPORT 2023

06 |

Our 360° Vision

Chairman’s Statement

CEO’s Statement

Sipchem Overview

Board of Directors

Operational Highlights

Financial Highlights

10 |

12 |

14 |

16 |

18 |

20 |

IN THE NAME OF ALLAH

THE MOST COMPASSIONATE, THE MOST MERCIFUL

SIPCHEM | ANNUAL REPORT 2023

“

“Since the announcement of our wise government, under the leadership of the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud and His Royal Highness Prince Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince and Prime Minister, the Transition Program 2020 and the vision of the Kingdom of Saudi Arabia 2030, Sipchem has been working in a fast pace to keep abreast of the Kingdom’s economic development and its direction of promoting sustainable economic resources in the interests of the nation, which will result in diversification of its investments and the excellence of its products supported by the researches conducted through its scientific research centre.

“

The Custodian of the Two Holy Mosques King Salman bin Abdulaziz Al Saud

His Royal Highness Prince Mohammed bin Salman bin Abdulaziz Al Saud Crown Prince, Prime Minister

SIPCHEM | ANNUAL REPORT 2023

Our 360° Vision for the Future

Progress is not linear. It’s circular. Due to constantly changing circumstances, sustaining success requires constant work. New competitors are entering our market, customers needs are changing, new technologies enables new solutions, and so on. Therefore, building our path to prosperity requires constant planning and iteration. Not in parts but as a whole – a 360° vision. Firstly, we need to be certain we are working towards the right goals, which is why we need to identify what matters most in our future. Consequently, in 2023, we appointed a strategy team to define fresh ideas, processes and products. In short, 360° Innovations that when implemented will lead to positive effective progress.

SIPCHEM | ANNUAL REPORT 2023

Our plan to achieve Innovation 360°

The process

1. Analysing Problems

(strategic planning and understanding)

2. Building Solutions

(that overcome challenges with creativity)

3. Implementing Initiatives

(putting plans into practice)

Our investment in Innovation 360°

In 2023 we invested in:

SIPCHEM | ANNUAL REPORT 2023

A. Human Resources

(employ the best + constant training / development)

B. New Product Development

(researching, defining and launching sustainable new products)

C. Market Development

(opening new markets, investing in entrepreneurial start-ups)

Our intended outcome Innovation 360°

• Opening new markets

• Greater shareholder returns

• Merger, acquisitions and customer growth

• Prestige and recognition

• New products and processes

SIPCHEM | ANNUAL REPORT 2023

Chairman’s Message

Eng. Khalid Abdullah Al-Zamil

Chairman of the Board

Dear, Shareholders of Sahara International Petrochemical Company “Sipchem”, May the Peace, Mercy and Blessings of Allah be bestowed upon you. On behalf of myself and my colleagues in the Board of Directors of Sahara International Petrochemical Company “Sipchem”, we are pleased to present Sipchem annual report to provide an insight into Sipchem’s notable achievements over the past year, as well as the challenges encountered by the Company. The report encompasses an overview of the Company’s performance and endeavours exerted throughout the past year, which witnessed numerous successes achieved by Sipchem. This success After God’s grace first, and foremost, is attributed to the full support from the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz, the Crown Prince His Royal Highness Prince Mohammed bin Salman, may Allah protect them, as well as the wise government and dedication and commitment of the Company’s employees and their strong determination. Sipchem has provided a conducive environment that fosters production and excellence to accomplish the Company’s objectives and steadily strive towards achieving its ambitious strategic objectives. “Sipchem” has successfully achieved its set objectives by enhancing its operational efficiency, in addition to implementing numerous initiatives that, with the help of Allah, contributed to mitigating the impact of global geopolitical and economic fluctuations, aspiring to support the promising and ambitious development goals of our beloved country in line with Saudi Vision 2030. Furthermore, we derive our strength, after God Almighty, from the Company’s ambitious strategic pillars, which support the Company’s plans to adapt to changing circumstances, expand its operations and investments, achieve growth, and build new business models that contribute to enabling sustainable transformation. Furthermore, “Sipchem” is steadfast in achieving its desired excellence by investing in young talents, who are the emerging leaders, as well as conscientious efforts towards digital transformation and dedication to integrating sustainability concept into its operations. In conclusion, “Sipchem” aspires to establish constructive values that benefit the business and its shareholders and boost the Company’s presence in competitive sectors and markets, following a journey spanning almost a quarter of a century, crowned with achievements and successes. I would also like to express my gratitude and appreciation to my fellow members of the Board of Directors, the executive management, and all employees of the Company. Additionally, I extend my thanks to those who have supported the Company throughout its journey thus far. Peace and blessings of Allah be upon you.

Eng. Khalid Abdullah Al-Zamil

Chairman of the Board

CEO’s Statement

SIPCHEM | ANNUAL REPORT 2023

Our remarkable results from 2022 gave us the confidence and resources to further implement our innovative and successful initiatives across all aspects of our organisation. In short, Innovation 360°. Our innovation is not a random act, but a result of meticulous planning and foresight. It is built on our strategic pillars of growth, profitability, sustainability, innovation, digital transformation, and human resources, all empowered by our core values of Courage, Passion, Agility, and Collaboration. With this solid foundation, we are like a coiled spring, ready to confidently leap forward in 2024. We had the Courage to break new ground by entering the Blue Ammonia market, a sector that’s growing phenomenally, propelled by the global necessity to reduce greenhouse gas emissions. Consequently, Blue Ammonia fits in perfectly with our sustainability strategy. In 2023, we made huge strides in reducing our carbon emissions and launched further environmental initiatives. We demonstrated our Flexibility by launching numerous digital transformation projects. Thereby swiftly adapting to changes in the petrochemical industry and achieving optimal sustainable results. We progressed in Collaborating with government sectors via partner projects and developed long- term sustainable business relationships. We owe our success to the collective Passion of our staff and the unwavering support and engagement of the local community. This partnership is not just a one-way street. Together, we have made significant contributions to local educational, charitable, social, and health causes, fostering a sense of pride and belonging in our shared achievements. Innovation 360° isn’t about 2023 or even 2024. It’s a strategy for the future. We are paving our pathway to success, and I’d like to thank everyone sharing this journey with us.

Abdullah s. Al-Saadoon

Chief Executive Officer

“

We view 2023 as the launchpad for our future – the year when we took a 360° overview of our operations. We invested in making improvements where improvements were needed, by streamlining our manufacturing processes, digital transformation, fresh product lines and

staff training. Sipchem is now perfectly poised to progress on its journey to becoming the major player in the petrochemical industry.

“

Abdullah S. Al-Saadoon

Chief Executive Officer

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A Continuous Cycle of Growth

Sipchem is one of the largest companies in the petrochemical sector in the Kingdom of Saudi Arabia. Its success is built upon its dedication to technological innovation, product development, and sustainability.

Sipchem has taken a holistic approach to providing sustainable quality petrochemical and polymer products as one of the world’s leading and most ambitious petrochemical producers. Sipchem’s growth and success are global. With an established presence in more than 100 countries around the world, it is supported by over 1,500 employees from over 27 nations, creating a truly international workforce. In 2023, Sipchem’s Innovation 350° drive, a testament to our commitment to continuous improvement and innovation, has prepared the organisation for a prosperous future. This drive is not just a strategy but a mindset that permeates every aspect of our operations, ensuring our continued success.