On 2026-05-12 08:01:19 (Saudi Time), Arabian Contracting Services Co. announced its Interim financial results for the three months ended on March 31, 2026.

Year-on-Year Performance Drivers

Sales declined 21.992% YoY to SAR 415.65 million, primarily due to ongoing geopolitical tensions in the region that negatively impacted advertising spending levels. Net profit plummeted 94.544% YoY to SAR 8.88 million, driven by the revenue decline and significantly higher operating costs associated with the commencement and handover of several new advertising sites. The profit deterioration was further exacerbated by increased lease expenses, depreciation, and finance costs that negatively affected profit margins during the period.

Quarter-on-Quarter Performance Drivers

QoQ revenue declined 28.31% to SAR 415.65 million due to ongoing geopolitical tensions in the region that negatively impacted advertising spending levels. Net profit plummeted 93.69% to SAR 8.88 million, driven by the revenue decline and higher operating costs from commencing and handing over several new advertising sites. These new sites led to increased lease expenses, depreciation, and finance costs, further compressing profit margins during the period.

Other Items

The auditors issued an unmodified conclusion but included an emphasis of matter regarding the restatement of comparative interim consolidated financial information for the three-month period ended March 31, 2025. The restatement resulted from the Group reassessing the accounting policy for a certain contract through one of its subsidiaries to determine the most appropriate application of accounting policies following the availability of new information related to the contract. The Company reassessed the accounting treatment for the contract for construction, operation, and maintenance of outdoor advertising billboards in Riyadh, concluding that the contractual arrangement does not fall within the scope of public service concession arrangements and applied updated accounting treatment under IFRS 16 "Leases" instead. This reassessment was undertaken after engaging two independent global accounting advisory firms and was approved by the Audit Committee and Board of Directors. Total shareholders equity increased 0.77% to SAR 1,560,426 thousand, while earnings per share declined significantly from SAR 2.96 to SAR 0.16.

Original announcement:

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