On 2026-08-11 16:04:37 (Saudi Time), Development Works Food Co.(6013.SA) 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, sales/revenue declined 14.509% YoY to SAR 47.80 million (from SAR 55.92 million), driven by a drop in sales volume across certain company brands due to weakened demand and a shift in consumer behavior stemming from regional geopolitical events. The company swung to a net loss of SAR 1.74 million from a net profit of SAR 2.51 million in the same period of the prior year, as the revenue decline was compounded by a significant rise in imported raw material costs also attributable to the prevailing regional conditions. Gross profit fell sharply by 66.017% YoY to SAR 2.27 million (from SAR 6.68 million), reflecting severely compressed margins, while accumulated losses reached SAR 14.31 million, representing 47.7% of capital, further exacerbated by provisions for certain receivables recorded in the prior year.

Quarter-on-Quarter Performance Drivers

QoQ revenue declined 11.609% to SAR 22.43(currency not specified in original) million (from SAR 25.37(currency not specified in original) million), driven by weakened demand and a shift in consumer behavior attributed to current regional events. The net profit swung to a loss of SAR -1.88(currency not specified in original) million (from a profit of SAR 0.13(currency not specified in original) million in the prior quarter), primarily due to the combined impact of lower sales volumes and a rise in imported raw material costs resulting from the same regional conditions. Wait, let me re-read the currency rules. The figures are in "Actual" Saudi Arabia Riyals, so I divide by 1,000,000. Also, the currency "SAR" is explicitly stated in the table footer ("Saudi Arabia, Riyals") and in the Additional Information section ("SAR 14,309,524"), so I should use SAR. Let me recalculate: - Current quarter revenue: 22,429,073 / 1,000,000 = 22.43 million SAR - Previous quarter revenue: 25,374,901 / 1,000,000 = 25.37 million SAR - Current quarter net loss: -1,876,224 / 1,000,000 = -1.88 million SAR - Previous quarter net profit: 131,270 / 1,000,000 = 0.13 million SAR QoQ revenue fell 11.609% to SAR 22.43 million (from SAR 25.37 million), driven by weakened demand and a shift in consumer behavior stemming from current regional events. Net profit swung to a loss of SAR -1.88 million from a profit of SAR 0.13 million in the prior quarter, as the decline in sales volume was compounded by a rise in imported raw material costs attributable to the same regional conditions.

Other Items

The external auditor issued an unmodified conclusion for the six-month period ended June 30, 2026, but included an emphasis of matter paragraph highlighting a material uncertainty regarding the Group's ability to continue as a going concern. As stated in the auditor's report, the Group incurred a loss of SAR 2,203,050 for the period ended June 30, 2026, accumulated losses amounted to SAR 14,309,524, representing 47.7% of capital as of that date (compared to SAR 12,564,570, representing 41.9% of capital as of December 31, 2025), and current liabilities exceeded current assets by SAR 16,008,214 (compared to SAR 14,963,560 as of December 31, 2025). The auditor noted that these events and circumstances, along with other matters described in Note (5-1) to the condensed consolidated interim financial statements, indicate a material uncertainty that may cast significant doubt on the Group's ability to continue as a going concern, while clarifying that the conclusion is not modified in this respect. Total shareholders' equity declined 38.227% to SAR 15,306,604 from SAR 24,778,806 in the same period of the prior year, and loss per share stood at SAR -0.58 compared to earnings per share of SAR 0.84 in the prior year period. The company stated that the procedures and instructions applicable to companies listed on the Saudi Stock Exchange whose accumulated losses have reached 35% or more of their capital will be applied, and affirmed its commitment to addressing these losses and improving its financial performance, with management working to enhance operational efficiency and explore new revenue opportunities.

Original announcement:

https://www.saudiexchange.sa/wps/portal/saudiexchange/newsandreports/issuer-news/issuer-announcements/issuer-announcements-details/?anId=97551&anCat=1&cs=6013&locale=ar

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