Riyadh, Saudi Arabia — SHL Finance Co. reported a 144% year-on-year increase in net profit for the first half of 2025, reaching SAR 26.01 million, according to a statement on Tadawul. The strong performance was driven by higher income from special commission financing and increased loan volumes.

Credit Margins and Loan Growth Offset Provision Hike

Total income from special commission financing rose 10.5% to SAR 194.91 million in H1 2025, compared to SAR 176.33 million in the same period last year. Net income from special commissions jumped nearly 35% year-on-year to SAR 96.04 million, reflecting improved profit margins on new loans and a growing financing portfolio.

The company’s total assets increased to SAR 4.66 billion, up 4.6% from a year earlier. Its financing and investment portfolio expanded by 5% to SAR 4.5 billion.

Net profit for the second quarter of 2025 came in at SAR 11.93 million, up 97.5% from Q2 2024 but down 15.3% from the previous quarter. The sequential decline was attributed to a rise in credit loss provisions, which climbed to SAR 4.81 million from a reversal of SAR 0.76 million in Q1.

SHL Finance noted that the increase in provisions reflected the expansion of its loan book. Operating expenses before provisions remained stable year-on-year at SAR 82.84 million in Q2.

Total comprehensive income for the six months stood at SAR 25.54 million, up 133% from the same period last year. Shareholders’ equity rose modestly to SAR 1.71 billion, reflecting a 2.5% increase. Earnings per share improved to SAR 0.26, up from SAR 0.10 in H1 2024.

Investor Takeaways

  • Commission income grew 35%, boosting profitability despite flat total income growth
  • Net profit nearly tripled, but Q2 slowdown highlights rising credit risk provisions
  • Loan book growth was modest at 5%, with stable expenses supporting margin expansion
  • Equity and asset growth remain conservative, signaling fiscal prudence

 

 

THE SAUDI STANDARD’S VIEW: SHL Finance’s Profit Surge Highlights Lending Efficiency and Sectoral Growth

SHL Finance’s 144% surge in H1 2025 net profit to SAR 26.01 million underscores the growing strength and strategic agility of Saudi Arabia’s non-bank finance sector, driven by rising loan volumes, improved pricing, and stable operational control.

  • A 35% rise in net special commission income and a 10.5% increase in total income from financing activities reflect margin optimization and a healthy expansion of SHL’s lending book, now valued at SAR 4.5 billion, up 5% year-on-year.
  • Despite a quarter-on-quarter dip in Q2 profit due to increased credit loss provisions, the rise in expected loss coverage signals prudent risk management as the company expands its credit footprint—a key marker of sustainable portfolio growth.
  • Stable operating expenses and a modest increase in total assets to SAR 4.66 billion reinforce SHL’s cost discipline and capital efficiency, crucial traits in a competitive, rate-sensitive lending environment.
  • The 2.5% equity growth and improved earnings per share to SAR 0.26 demonstrate strengthening shareholder value and position SHL as a rising contributor to Vision 2030’s financial inclusion and consumer lending objectives.

SHL Finance’s performance reflects the broader maturity of Saudi Arabia’s financial services landscape, where specialized lenders are delivering double-digit growth through scalable operations and measured risk-taking. As household financing demand and SME lending rise, firms like SHL will be essential in expanding access to credit and deepening the Kingdom’s non-bank financial ecosystem.

 

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