Nayifat Finance Co. announces its Annual Financial results for the period ending on 2025-12-31

Element List	Current Year	Previous Year	%Change
Sales/Revenue	341,207	365,480	-6.64
Gross Profit (Loss)	298,241	319,240	-6.58
Operational Profit (Loss)	-120,109	148,986	-
Net Profit (Loss) Attributable to Shareholders of the Issuer	-126,337	131,236	-
Total Comprehensive Income Attributable to Shareholders of the Issuer	-125,812	131,071	-
Total Shareholders Equity (after Deducting Minority Equity)	1,239,517	1,447,985	-14.4
Profit (Loss) per Share	-1.06	1.09
All figures are in (Thousands) Saudi Arabia, Riyals

Element List	Amount	Percentage of the capital (%)
Profit (Losses) Resulting From The Change In Investment Propertie’s Fair Value	-	-
All figures are in (Thousands) Saudi Arabia, Riyals

Element List	Explanation
The reason of the increase (decrease) in the sales/ revenues during the current year compared to the last year	The reason of decrease in revenues during the current year compared to last year is the decline in commission income from Islamic financing receivables by 6.6% which is primarily attributable to the strategic shift towards acquiring a higher credit quality customer segment, in addition to early settlements that no longer effectively contribute to the consumer financing portfolio revenues.
The reason of the increase (decrease) in the net profit during the current year compared to the last year is	The reason of decrease in net profit during the current year compared to last year by 196% is primarily driven by an increase in expected credit loss provisions, as the Company reassessed the write-off point for personal and SME Islamic financing receivables, which more accurately reflects the expected recovery trajectory of the portfolio. The Company adopted an ECL estimation methodology and criteria aligned with the principles of conservatism, and best practices. The reported accounting loss does not indicate a structural weakness in the Company’s business model, financial position, or capabilities, and the Company’s operational fundamentals remain intact.

Element List

Explanation

The reason of the increase (decrease) in the sales/ revenues during the current year compared to the last year

The reason of decrease in revenues during the current year compared to last year is the decline in commission income from Islamic financing receivables by 6.6% which is primarily attributable to the strategic shift towards acquiring a higher credit quality customer segment, in addition to early settlements that no longer effectively contribute to the consumer financing portfolio revenues.

The reason of the increase (decrease) in the net profit during the current year compared to the last year is

The reason of decrease in net profit during the current year compared to last year by 196% is primarily driven by an increase in expected credit loss provisions, as the Company reassessed the write-off point for personal and SME Islamic financing receivables, which more accurately reflects the expected recovery trajectory of the portfolio. The Company adopted an ECL estimation methodology and criteria aligned with the principles of conservatism, and best practices. The reported accounting loss does not indicate a structural weakness in the Company’s business model, financial position, or capabilities, and the Company’s operational fundamentals remain intact.

Additionally, the Company experienced a 6.6% decrease in operating revenues and an 13% increase in general and administrative operating expenses.

The Company’s adoption of the new methodology represents a prudential adjustment and a conservative measure against potential risks, some of which constitute a one-time treatment, thereby establishing a stronger foundation and providing enhanced and improved risk measurement standards for future periods. This also facilitates access to various funding sources, while adhering to best financing standards and achieving financial stability for the Company through a prudential approach that maintains flexibility within the scope of risk management. Statement of the type of external auditor's report Unmodified opinion Comment mentioned in the external auditor’s report, mentioned in any of the following paragraphs (other matter, conservation, notice, disclaimer of opinion, or adverse opinion) NA Reclassification of Comparison Items NA Additional Information NA

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