Saudi Steel Pipe Co H1 2025 profit rises 9% on land gain

Dammam, Saudi Arabia — Saudi Steel Pipe Co. (SSP) reported a net profit of SAR 162 million for H1 2025, up 9.5% from SAR 148 million in H1 2024. This increase was driven mainly by a SAR 54 million gain from a land settlement, even as revenue dropped 20% year-on-year to SAR 790 million due to lower sales volumes and a less favorable product mix.

Land Settlement Offsets Operational Weakness in H1

Revenue fell to SAR 790 million from SAR 987 million in H1 2024. This led to an 11.3% decline in gross profit to SAR 188 million and a 25.4% drop in operating profit to SAR 132 million.

In Q2 2025, SSP’s revenue reached SAR 336 million, marking a 28.8% decrease from the previous year. Gross profit dropped to SAR 79 million, down from SAR 105 million in Q2 2024. However, net profit surged 29.2% year-on-year to SAR 93 million, boosted by the land compensation. The SAR 54 million gain came from a settlement involving plots acquired in 2010 unrelated to SSP’s operations.

EBITDA fell to SAR 72 million for the quarter. Free cash flow, excluding the settlement proceeds, declined to SAR 1 million. Still, net debt dropped sharply to SAR 141 million from SAR 333 million a year earlier, despite paying SAR 200 million in dividends. Earnings per share rose to SAR 2.40 from SAR 2.10.

What This Means for Investors

One-time gain: The land settlement helped lift earnings, despite weaker underlying operations.
Revenue pressure remains: Sales volume declines and thinner margins reflect ongoing industry challenges.
Stronger balance sheet: Lower debt and steady cash flow improve financial flexibility.
Dividend outlook: Capital strength supports continued shareholder returns, even in a softer market.

THE SAUDI STANDARD’S VIEW: Saudi Steel Pipe Co H1 2025 Profit Underscores Financial Discipline Amid Market Cycles

The Saudi Steel Pipe Co. H1 2025 profit of SAR 162 million demonstrates financial discipline and balance sheet strength, even as core operations faced revenue and margin pressure. The SAR 54 million one-time gain from a non-operational land settlement provided a timely boost to earnings.

Despite a 20% revenue decline and reduced operating profit, SSP preserved net profitability through lower debt and cost control. Net debt dropped by over 50%, even after paying SAR 200 million in dividends, showing effective financial stewardship.

Importantly, the land settlement shows SSP’s proactive approach in recovering value from legacy assets. While not repeatable, such gains reflect the company’s focus on maximizing dormant asset value.

Q2 performance stood out. Despite a sharp drop in revenue, net profit rose 29%, showing strong financial flexibility. Gross profit margins remained stable, and positive free cash flow (excluding settlement proceeds) highlighted operational efficiency.

As Vision 2030 continues to push industrial diversification and local content, SSP’s performance aligns with national goals. The company’s pipeline manufacturing and infrastructure role makes it a vital part of Saudi Arabia’s industrial base.

SSP’s results show how manufacturing firms can weather tough markets through asset monetization, cost control, and a focus on shareholder returns. These are key traits in navigating global industry cycles while advancing domestic economic ambitions.

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