On 2026-07-29 08:16:05 (Saudi Time), Methanol Chemicals Co. announced its Interim financial results for the three months ended on March 31, 2026.

Year-on-Year Performance Drivers

Sales declined 24.669% YoY from SAR 165.59 million to SAR 124.74 million, primarily driven by a 23% drop in selling quantities due to regional supply chain and logistical challenges, with the Parent Company rerouting shipments through alternative trade corridors to minimize the financial impact. Net loss attributable to shareholders widened marginally by 3.806% YoY from SAR 44.66 million to SAR 46.36 million, as the volume decline was partially offset by cost-optimization measures that helped contain the loss expansion to only 4% despite a 25% revenue decrease. Subsidiaries contributed approximately 20% (SAR 9.3 million) of total losses during the quarter, even without any depreciation and amortization expense, as all fixed assets were fully impaired in Q2 of the prior year. Additionally, regional market challenges affected key shipping routes and their associated costs, further weighing on overall results.

Quarter-on-Quarter Performance Drivers

QoQ revenue declined 13.453% to SAR 124.74 million (vs. SAR 144.13 million in the prior quarter), primarily driven by a 21% drop in selling quantities due to regional supply chain and logistics challenges. The net result swung from a profit of SAR 30.43 million in the previous quarter to a loss of SAR 46.36 million in the current quarter, largely because the prior quarter benefited from the reversal of a SAR 94.5 million provision (originally recognized in Q2 2025 against receivables from subsidiaries for working capital support and feedstock supply). Subsidiaries contributed 20% (SR 9.3 million) to total losses this quarter even without depreciation and amortization, as all fixed assets were fully impaired in Q2 of the prior year. Regional market volatility further impacted shipping routes and costs, though the Parent Company mitigated the effect by rerouting shipments through alternative trade corridors.

Other Items

Methanol Chemicals Co.'s external auditor issued an unmodified conclusion for the three-month period ended March 31, 2026, accompanied by an Emphasis of Matter paragraph highlighting a material uncertainty that may cast significant doubt on the Group's ability to continue as a going concern. As stated in the auditor's report: "the Group has incurred a net loss of SR 48.3 million for the three-month period ended 31 March 2026. As at that date, the Group's current liabilities exceeded its current assets by SR 355.9 million and the Group's accumulated losses exceeded half of its share capital. In addition, the Group is involved in legal proceedings as described in Note 3." The auditor noted that management's plans, including a planned rights issue and other mitigating measures, are disclosed in Note 3, and that the financial statements were prepared on a going concern basis. Accumulated losses as of March 31, 2026 amounted to SAR 597.67 million, representing 88.6% of the Company's capital, with the majority of these losses resulting from the negative impact of acquisitions. Total shareholders' equity (after deducting minority equity) stood at SAR 238.85 million, a decline of 67.011% compared to the same period of the prior year. Loss per share was SAR -0.69 for the current period versus SAR -0.66 in the same period last year. The Extraordinary General Assembly held on July 14, 2026 approved a reduction of the Company's share capital to SAR 150,000,000, along with the utilization of SAR 53.4 million from the statutory reserve to cover the remaining balance of accumulated losses as of September 30, 2025; the Parent Company is in the process of completing the remaining statutory formalities with governmental authorities. Certain corresponding figures have been restated for better presentation, as detailed in Note 18. The procedures and instructions for listed companies with accumulated losses of 20% or more of their capital will be applied.

Original announcement:

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