| Element List | Current Quarter | Similar quarter for previous year | %Change | Previous Quarter | % Change |
|---|---|---|---|---|---|
| Sales/Revenue | 152.38 | 169.04 | -9.855 | 167.9 | -9.243 |
| Gross Profit (Loss) | 1.24 | 24.53 | -94.944 | 15.44 | -91.968 |
| Operational Profit (Loss) | -475.57 | -19.34 | 2,358.996 | -30.24 | 1,472.652 |
| Net profit (Loss) | -427.26 | -28.28 | 1,410.82 | -40.47 | 955.744 |
| Total Comprehensive Income | -427.26 | -28.28 | 1,410.82 | -40.47 | 955.744 |
| All figures are in (Millions) Saudi Arabia, Riyals | |||||
| Element List | Current Period | Similar period for previous year | %Change |
|---|---|---|---|
| Sales/Revenue | 320.28 | 352.31 | -9.091 |
| Gross Profit (Loss) | 16.68 | 46.36 | -64.02 |
| Operational Profit (Loss) | -505.81 | -35.91 | 1,308.549 |
| Net profit (Loss) | -467.73 | -52.5 | 790.914 |
| Total Comprehensive Income | -467.73 | -52.5 | 790.914 |
| Total Shareholders Equity (after Deducting Minority Equity) | 300.97 | 988.1 | -69.54 |
| Profit (Loss) per Share | -6.93 | -0.78 | |
| All figures are in (Millions) Saudi Arabia, Riyals | |||
| Element List | Amount | Percentage of the capital (%) | |
|---|---|---|---|
| Profit (Losses) Resulting From The Change In Investment Propertie’s Fair Value | - | - | |
| Accumulated Losses | 535.55 | 79 | |
| All figures are in (Millions) Saudi Arabia, Riyals | |||
| Element List | Explanation |
|---|---|
| The reason of the increase (decrease) in the sales/ revenues during the current quarter compared to the same quarter of the last year is | The decrease in revenue by 10% during the current quarter compared to the same quarter of the previous year is primarily attributable to an 18% decline in average selling prices. |
| The reason of the increase (decrease) in the net profit during the current quarter compared to the same quarter of the last year is | Major reasons for the increase in operational losses of the Parent Company (Chemanol) of SR 41.4 million (being 9.7% of the total loss for the current quarter of SR 427.3 million) as compared to the same quarter of last year: |
- An 18% decrease in selling prices.
- The increase in feedstock (natural gas) prices at the beginning of the year has contributed to higher production costs during the current quarter compared to the same quarter of the previous year.
The above reasons resulted in losses of SR 41.4 million for the Parent Company (Chemanol) during the current quarter, compared to SR 17.4 million in the same quarter of the previous year.
Major reasons for the other 90.3% of the losses in the current quarter (SR 386 million) as compared to the losses of the same quarter last year are due to the impact of the acquired companies as follows :
- The group’s losses were impacted by the financial performance of the subsidiaries (GCI and ACC) acquired during the term of the previous Board, which recorded a combined loss of SR 12.2 million during the current quarter, compared to SR 10.6 million in the same quarter of the previous year.
- Additional impairment charge of SR 279.3 million relating the assets of the subsidiaries (ACC and GCI), and,
- Additional provisions of SR 94.5 million relating to amounts due from the subsidiaries to Chemanol for working capital support and feedstock.
Such impact was recognized following an assessment of the recoverable amounts of these assets which indicated a decline due to the two subsidiaries’ continued losses.
The above reasons resulted in losses of SR 41.4 million for Chemanol Parent Company during the current quarter, compared to SR 30.4 million in the previous quarter.
Further, major reasons for the remaining 90.3% of the losses (SR 386 million) in the current quarter as compared to the losses of the previous quarter due to the impact of the acquired companies as follows :
- The group’s losses were impacted by the financial performance of the subsidiaries (ACC and GCI acquired during the term of the previous Board), which recorded a combined loss of SR 12.2 million during the current quarter, compared to SR 10.6 million in the previous quarter.
The losses were further impacted by:
- Additional impairment charge of SR 279.3 million relating the assets of the subsidiaries (ACC and GCI), and,
- Additional provisions of SR 94.5 million relating to amounts due from the subsidiaries to Chemanol for working capital support and feedstock.
Such impact was recognized following an assessment of the recoverable amounts of these assets which indicated a decline due to the subsidiaries’ continued losses.
- 12% decline in average selling prices.
- Additionally, the increase in feedstock (natural gas) prices at the beginning of the year has contributed to higher production costs during the current period.
- The above reasons resulted in losses of SR 71.8 million for Chemanol Parent Company during the current period, compared to losses of SR 39.0 million in the same period of the previous year.
Major reasons for the remaining 84.7% of the losses (SR 396 million) in the current period as compared to the losses of the previous period due to the impact of the acquired companies as follows:
- The group’s losses were impacted by the financial performance of the subsidiaries (ACC and GCI acquired during the term of the previous Board), which recorded a combined loss of SR 22.1 million during the current period compared to SR 13.5 million in the same period of the previous year.
- Additional impairment charge of SR 279.3 million relating the assets of the subsidiaries (ACC and GCI), and,
- Additional provisions of SR 94.5 million relating to amounts due from the subsidiaries to Chemanol for working capital support and feedstock.
Such impact was recognized following an assessment of the recoverable amounts of these assets which indicated a decline due to the subsidiaries’ continued losses.
We draw attention to Note 3 in the interim condensed consolidated financial statements, which indicates that the Group has incurred a net loss of SR 529.3 million for the period ended 30 June 2025 and, as of that date, the Group’s current liabilities exceeded its current assets by SR 314.6 million and accumulated losses of the Group exceeds half of its capital. These events or conditions, along with other matters as set forth in Note 3, indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. The ability of the Group to continue its operations is dependent on the completion of measures as detailed in Note 3 and in particular a rights issue that management expects to complete in the second quarter of 2026. Further, as detailed in Note 3, the Board of Directors of the Company have decided not to assume the credit facilities of its subsidiaries. Consequently, the ability of the Company to initiate and complete the rights issue is contingent upon various factors, including regulatory approvals. The Parent Company has accordingly prepared these interim condensed consolidated financial statements on a going concern basis. Our opinion is not modified in respect of this matter.
Other legal and regulatory requirements:
We draw attention to Note 3 to the accompanying interim condensed consolidated financial statements, the accumulated losses of the Group exceeded half of the Capital as at the reporting date. As required by Article 132 of the Saudi Arabian Regulations for Companies’ Law, the Board of Directors shall, within 60 days from the date of its knowledge thereof, announce the losses and the recommendations relating thereto, and shall, within 180 days from said date, call for an extraordinary general assembly meeting to address the solvency issue and to consider the continuation of the Parent Company by taking measures necessary to resolve such losses or the dissolution of the Parent Company. As at the date of this report, the shareholder announcement of the losses and their recommendations has not been published and extraordinary general assembly meeting was not convened as required by law.
The Board of Directors, in its commitment to protecting shareholders' rights and interests, recently had the Company appoint a specialized law firm to examine its legal position on two acquisition deals (ACC and GCI) and the circumstances surrounding their conclusion during the previous board term. The Company will initiate legal action against those responsible for the deals once it has reviewed the findings of the ongoing forensic investigation, which is being conducted by a specialized consulting firm.
Actions Taken and Important Dates:
According to Article (132) of Companies Law, if a joint-stock Company's losses reach half of its issued capital, the Board of Directors must disclose this and its recommendations regarding these losses within sixty days of becoming aware of this amount. The Board of Directors must also convene an Extraordinary General Assembly within one hundred and eighty days of becoming aware of this to consider the continuation of the Company, take any necessary measures to address these losses, or dissolve the Company.
Accordingly, we would like to indicate the following dates:
- The last date for the Board of Directors to disclose its recommendations regarding the accumulated losses is 9 October 2025.
- The last date on which the Board shall call for an extraordinary general assembly meeting in order to consider the continuation of the Company while taking any necessary measures to address the losses or dissolve the Company is 7 February 2026.
The Company's Board of Directors received official notification on 10 August 2025, stating that the accumulated losses have reached this level, due to the following reasons:
- Recording losses resulting from a decline in the value of fixed assets and goodwill of the ACC and GCI which were acquired during the previous board’s term
- Financial results were also impacted by the additional provisions relating to the acquired companies and the operational losses of the group .
It is worth noting that the procedures and instructions for listed companies with accumulated losses of 20% or more of their capital will be applied.
The Capital Market Authority and Saudi Exchange take no responsibility for the contents of this disclosure, make no representations as to its accuracy or completeness, and expressly disclaim any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this disclosure, and the issuer accepts full responsibility for the accuracy of the information contained in it and confirms, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts or information the omission of which would make the disclosure misleading, incomplete or inaccurate.