ALHASOOB CO. NET PROFIT SURGES 50% TO 2.9 MILLION SAR IN H1 2026

Riyadh, Saudi Arabia — Alhasoob Co. posted a net profit of 2.87 million SAR for the six months ending June 30, 2026, a 50.5% jump from 1.91 million SAR in the same period last year. Revenue climbed 20.7% to 153.4 million SAR, driven almost entirely by a surge in international sales. However, auditors issued a qualified conclusion over the company’s inability to provide an inventory aging schedule — a red flag investors should not overlook.

Revenue Growth Fueled by International Sales

Alhasoob’s top-line growth tells a clear story. Sales outside Saudi Arabia nearly doubled, rising from 29.5 million SAR in H1 2025 to 64.3 million SAR in H1 2026. That single factor drove total revenue from 127.1 million SAR to 153.4 million SAR. Gross profit followed, expanding from 8.5 million SAR to 12.1 million SAR. Operating profit also improved, moving from 2.6 million SAR to 4.5 million SAR. Together, these gains pushed net profit to 2.87 million SAR, with earnings per share rising from 0.68 SAR to 1.03 SAR.

Key Drivers

• International sales nearly doubled to 64.3 million SAR, up from 29.5 million SAR in H1 2025.
• Total revenue increased 20.7% to 153.4 million SAR from 127.1 million SAR.
• Gross profit rose from 8.5 million SAR to 12.1 million SAR.
• Operating profit grew from 2.6 million SAR to 4.5 million SAR.
• Net profit attributable to shareholders reached 2.87 million SAR, up 50.5%.
• Total shareholders’ equity increased 18% to 50.54 million SAR from 42.84 million SAR.
• Earnings per share climbed from 0.68 SAR to 1.03 SAR.

Restated Comparatives and Auditor Qualification

Alhasoob restated its H1 2025 figures under IAS 8 after recalculating its defined benefit plan obligation. The restatement raised prior-period net profit from 1.76 million SAR to 1.91 million SAR. Prior-period equity was adjusted down slightly, from 42.89 million SAR to 42.84 million SAR. Earnings per share for H1 2025 were also revised upward, from 0.63 SAR to 0.68 SAR.

More concerning, auditors issued a qualified conclusion. Alhasoob could not provide a detailed inventory aging schedule as of June 30, 2026. The company also lacked an approved policy for calculating provisions on slow-moving, obsolete, or idle inventory. With inventories carrying a value of 78.32 million SAR — the single largest asset on the balance sheet — auditors could not confirm whether the reported figures are accurate. Management says it is currently completing the relevant policy and reports.

What This Means for Investors

• The 50.5% profit jump is real but modest in absolute terms — 2.87 million SAR on 153.4 million SAR in revenue signals thin margins that leave little room for error.
• International sales are now the primary growth engine, representing roughly 42% of total revenue. Geographic concentration risk has shifted outside Saudi Arabia.
• The qualified audit opinion on 78.32 million SAR in inventory is a material concern. If provisions are later required, both equity and profit could be restated downward.
• Until Alhasoob publishes an approved inventory policy and aging analysis, reported profit and equity figures carry uncertainty that investors cannot currently quantify.

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THE SAUDI STANDARD’S VIEW: ALHASOOB’S PROFIT SURGE CARRIES A MATERIAL ASTERISK

Alhasoob’s H1 2026 results present a company growing at a credible pace, with international expansion emerging as a genuine strategic asset. However, a qualified audit conclusion over inventory controls introduces a layer of financial uncertainty that disciplined investors must weigh carefully against the headline numbers.

• MARGIN STRUCTURE DEMANDS SCRUTINY

A 50.5% surge in net profit is an attention-grabbing figure, but the underlying margin arithmetic is sobering. Net profit of 2.87 million SAR against revenues of 153.4 million SAR translates to a net margin below 2%, leaving the business acutely exposed to any cost pressure or revenue deceleration. Investors should assess whether operational leverage exists to meaningfully widen margins as the company scales.

• INTERNATIONAL SALES AS BOTH OPPORTUNITY AND RISK

The near-doubling of international revenues to 64.3 million SAR reflects genuine commercial momentum and demonstrates that Alhasoob’s proposition resonates beyond domestic borders. At roughly 42% of total revenue, however, this geographic pivot also concentrates performance on markets that carry distinct foreign exchange, regulatory, and counterparty risks. Sustained international growth requires infrastructure and risk management capabilities commensurate with that ambition.

• THE INVENTORY QUALIFICATION IS NOT A TECHNICALITY

Inventories of 78.32 million SAR represent the single largest asset on Alhasoob’s balance sheet, making the auditors’ qualified conclusion a substantive financial concern rather than a procedural footnote. Without an approved provisioning policy or an aging schedule, the carrying value of that inventory remains unverified, and any subsequent recognition of impairment or obsolescence provisions could materially reduce both reported equity and profit. Investors cannot responsibly price this risk until full inventory disclosures are published.

• RESTATEMENT PATTERN WARRANTS GOVERNANCE ATTENTION

The IAS 8 restatement of prior-period figures, while procedurally appropriate, adds to a picture of financial reporting processes still being refined. Companies that combine accounting restatements with qualified audit conclusions in the same reporting cycle signal that internal controls and finance governance require strengthening. Investors should monitor whether management delivers the promised inventory policy promptly, as execution speed here will serve as a proxy for broader governance credibility.

Alhasoob’s international growth trajectory is directionally consistent with Saudi Arabia’s Vision 2030 objective of building export-competitive private sector enterprises capable of generating revenue beyond the Kingdom’s borders. Yet sustainable value creation under that framework demands financial transparency and institutional-grade internal controls — precisely the areas where Alhasoob must now demonstrate rapid improvement. The company’s next interim filing will be a defining test of whether today’s profit growth is built on a foundation that can bear scrutiny.