Red Sea International Company announced its consolidated financial results for the first six months of 2025, reporting a net profit of SR1.87 million, a 168% improvement compared to the first half of 2024. However, net profit for Q2 2025 reached SR6.39 million, representing a 31% decline compared to Q2 2024. By the end of Q2 2025, revenues for the first half reached SR1,479 million, marking a 54% increase compared to H1 2024. Q2 2025 revenues stood at SR779 million, up 4% compared to Q2 2024. This growth was mainly driven by improved performance and higher project completion rates. Operating profit for the first six months of 2025 reached SR42.8 million, an increase of 44% compared to the same period in 2024. Operating profit for Q2 2025 stood at SR23.72 million, down 10% compared to Q2 2024. This performance improvement in the first half of the year came despite lower overall profitability, primarily due to accounting adjustments related to the Amortization of Purchase Price Allocation (PPA). In 2024, the company carried out a PPA for the acquisition of First Fix Company for Electrical Works Ltd., which resulted in an accounting loss of SR121.75 million in 2024 and SR48.7 million in H1 2025. These losses are purely accounting adjustments required under the International Financial Reporting Standards (IFRS) and do not represent actual operational losses. This has been clarified in the notes to the consolidated financial statements for the periods ending 31 March 2025 and 30 June 2025. To address the impact of the PPA provision, the company is implementing the Board of Directors' recommendation to increase capital by converting debts owed to minority shareholders (the sellers) in First Fix — specifically, the deferred portion of the acquisition price — into shares. The company has submitted this request to the Capital Market Authority, and it is currently under review, with a decision expected soon.
