Riyadh, Saudi Arabia — Saudi Cable Company posted a net profit of SAR 64.89 million in H1 2025, a sharp increase from SAR 7 million a year earlier. The improvement came mainly from equity income tied to its associate, Midal. However, the core business continued to post significant losses.

Uneven Q2 Performance and Margin Pressures

Total revenue surged 227% year-on-year to SAR 74.3 million due to new project wins and client growth. Despite this, the company posted a gross loss of SAR 18.9 million and an operating loss of SAR 55.4 million, similar to prior-year results.

In Q2 2025, revenue dropped 31.5% from Q1 to SAR 30.2 million. Net profit fell 61% to SAR 18.2 million. This decline reflected project delays and rising costs, particularly in materials. Gross loss widened to SAR 14.6 million, while the operating loss grew to SAR 41.5 million.

Balance Sheet Stress and Going Concern Risk

Accumulated losses rose to SAR 411.9 million, 617% of the share capital. Current liabilities exceeded current assets by SAR 881 million. As a result, the company’s external auditor issued a material uncertainty warning over its ability to continue as a going concern.

Saudi Cable is now executing a rights issue. It expects relief from incoming Midal cash flows, stake restructuring, and pledged associate collateral to address these liquidity challenges.

What This Means for Investors

  • Associate-driven gains: Most earnings stem from Midal, not core operations.
  • Operational losses continue: Despite higher sales, cost pressures and inefficiencies persist.
  • Financial health in doubt: Accumulated losses and working capital deficits threaten viability.
  • Restructuring critical: Rights issue and asset pledges must deliver results for continuity.

THE SAUDI STANDARD’S VIEW: Saudi Cable H1 2025 Profit Highlights Need for Urgent Turnaround

Saudi Cable’s H1 2025 profit of SAR 64.9 million—mostly from Midal—offers short-term relief but hides deeper problems. The company must shift from reliance on associate income to fixing its underlying operations.

  • Gross and operating losses show ongoing cost issues and weak market performance. Falling revenue and eroding margins in Q2 further highlight the fragility of core operations.
  • Accumulated losses and a SAR 881 million working capital gap expose deep financial risk. The auditor’s going concern alert stresses the urgency of action.
  • The SAR 52.5 million provision tied to its Turkish exit signals long-overdue cleanup efforts. However, progress depends on swift and credible restructuring.
  • The five-year plan and rights issue must focus on cutting losses, converting orders, and restoring competitiveness. Otherwise, short-term profits will not translate into long-term recovery.

The Saudi Cable H1 2025 profit underscores the urgency of real operational reform. The company must align with Vision 2030’s goals of industrial efficiency, private-sector discipline, and capital market integrity. Without this shift, investor trust and sustainability will remain at risk.

 

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