On 2026-08-09 08:09:33 (Saudi Time), Arabian Contracting Services Co. announced its Interim financial results for the six months ended on June 30, 2026.

Year-on-Year Performance Drivers

For the six-month period ending June 30, 2026, the Group's sales/revenue declined 29.092% YoY to SAR 679.58 million (from SAR 958.40 million), primarily driven by a decline in advertising demand and ongoing geopolitical tensions in the region, which led to lower client spending, cancellation of advertising campaigns, and reductions in allocated budgets. The Group swung from a net profit of SAR 129.70 million in the prior period to a net loss of SAR 205.58 million in the current period, mainly attributable to the sharp revenue decline compounded by higher associated operating costs stemming from the handover and operation of several new advertising sites whose advertising networks remained incomplete under the relevant contracts, resulting in elevated lease and depreciation expenses that significantly compressed profit margins.

Quarter-on-Quarter Performance Drivers

QoQ revenue declined 36.502% to SAR 263.93 million (from SAR 415.65 million in the prior quarter), driven by normal seasonal fluctuations and reduced advertising demand amid continued regional geopolitical tensions, which curtailed client spending and campaign volumes. The Group swung from a net profit of SAR 8.88 million in the previous quarter to a net loss of SAR 214.46 million in the current quarter, primarily due to the lower revenue base combined with higher operating costs stemming from the handover and operation of several new advertising sites whose networks remain incomplete, resulting in elevated lease and depreciation expenses that severely compressed profit margins.

Other Items

Arabian Contracting Services Co.'s interim financial report for the six months ended June 30, 2026, carries an unmodified conclusion from the external auditors. However, the auditors included an Emphasis of Matter paragraph drawing attention to Note 15, which discloses two restatements of comparative information: first, the comparative figures for the three-month and six-month periods ended June 30, 2025, were restated following the Group's reassessment — through one of its subsidiaries — of the accounting policy applied to a certain contract, with the contractual arrangement determined to fall outside the scope of service concession arrangements and instead accounted for under IFRS 16 "Leases"; second, the comparative information in the condensed interim consolidated statement of changes in equity for the six-month period ended June 30, 2025, was restated after management determined that an increase in ownership interest in Arab Out of Home Advertising Free Zone L.L.C. represented a business combination under common control, requiring the resulting difference of SAR 18,661,852 — initially recognized as Goodwill — to be reclassified directly to Retained Earnings. The auditors confirmed their conclusion was not modified in respect of either matter. On a period-to-period basis, total shareholders' equity (after deducting minority equity) declined 10.242% to SAR 1,344,422 thousand from SAR 1,497,845 thousand in the prior comparable period, while loss per share stood at SAR -3.74 compared to earnings per share of SAR 2.36 in the same period of the previous year. Gross profit for the current period fell 81.951% to SAR 76,149 thousand from SAR 421,924 thousand, and the Group recorded an operational loss of SAR 5,271 thousand versus an operational profit of SAR 323,393 thousand in the prior period. Total comprehensive loss attributable to shareholders reached SAR 207,168 thousand for the current period, compared to comprehensive income of SAR 130,820 thousand in the same period of the prior year.

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