Aamal Company Q.P.S.C. ($AHCS)

Good day, ladies and gentlemen, and welcome to the Aamal Company Q.P.S.C. Investors Conference Call First Quarter 2026 Financial Results Presentation. [Operator Instructions] I would like to remind all participants that this call is being recorded. [Operator Instructions] I'll now hand over to Zaid Shelleh, Investor Relations Manager, to start the presentation.

Thank you. Good afternoon, everyone, and thank you for joining us for Aamal Company's first quarter results presentation for the 3 months ended 31 March 2026. My name is Zaid Shelleh, Investor Relations Manager at Aamal, and I'm joined today by our Finance Controller, Corporate, Mr. Mohammad Arif. We will be walking you through the key highlights of the financial performance for the period, and we will be happy to take your questions at the end of the presentation. You can also follow using the slides available on Aamal website, which also available for download. Let's begin by the -- with the highlights on Slide 2. The first quarter of Aamal, [ Angel ] could you please the slide? Thank you. The first quarter of 2026 was a challenging period for Aamal with revenue and net profit declining year-on-year. This soft performance was driven particularly by the Trading and Distribution segment, where challenging conditions in the pharmaceutical market weighed on results, particularly at Ebn Sina Medical. At the same time, the broader performance of the group continued to demonstrate resilience in face of the challenging macroeconomic context. All of our other segments delivered revenue growth in the quarter with property, Managed Services and Industrial Manufacturing each showing encouraging underlying trends. During the period, we also remained focused on the delivery of our strategic priorities and on maintaining disciplined operational execution. In property, the acquisition of Aamal Tower continued to support growth while Managed Services the strong contribution from MMS helped underpin stable overall performance. In industrial manufacturer, construction and infrastructure-related business again provided encouraging support. Looking ahead, -- although the near-term environment has become more uncertain, we remain confident in the resilience of the business, the strength of the Qatar economy and Aamal ability to navigate evolving conditions while continuing to pursue long-term value creation. Turning to Slide 4. Group revenue for the first quarter declined by 19.9% to reach QAR 464.8 million, while gross profit decreased by 3.5% to reach QAR 124.2 million and net profit attributable to Aamal equity holders was down 11% to reach QAR 90.7 million. As we already stated, the key driver of this movement was because of the weaker performance in trading and distribution, where revenue and net profit declined by 28.3% and 21.5%, respectively. The rest of the group, however, remains resilient. Property, managed services and industrial manufacturing all recorded positive revenue growth, which again demonstrates the value of Aamal's diversified structure and balanced exposure across multiple sectors in the upper and the wider GCC economy. Net capital expenditure increased by 15.8% to reach QAR 7.6 million, while gearing rose to 7.01%. The increase in gearing was primarily due to the facility loan associated with the Aamal Tower acquisition, which has further strengthened the group's property portfolio. Turning to Slide 6, Industrial Manufacturing. The segment delivered mixed but overall encouraging net results in the quarter with revenue increasing by 2.5% to reach QAR 46 million. Net profit was broadly stable, declining marginally by only 1.5% to reach QAR 10.7 million. This reflects continued demand across infrastructure and construction-related activities even as some businesses face operational and market pressures. Aamal Readymix and Aamal Cement both recorded revenue growth during the period. At the Aamal Cement in particular, profitability increased significantly, supported by change in raw material specifications and suppliers' rebates. APC, Advanced Pipes and Casts also continued to make encouraging progress locally as well as in the Kingdom of Saudi Arabia entity. Elsewhere, Primes benefited from project wins secured during the second half of 2025, while Aamal Maritime reported a weaker performance due to the temporary dry docking of vessel, and lower global shipping rates. Senyar and Aamal Readymix also faced some pressure during the quarter from delivery in project -- for delays in project deliveries and margin compression. Overall, the segment remains supported by solid underlying demand and continue to offer attractive exposure to construction and infrastructure activity in Qatar and the wider region. Turning to Slide 7. This was the most challenging segment in the quarter, with revenue declining to QAR 307.5 million and net profit failing to QAR 22.4 million. The principal factor behind the performance was the subdued results in Ebn Sina Medical, where demand was adversely affected by the ongoing shift at Hamed Medical Corporation towards generic medicines alongside a more competitive market backdrop. That said, there was still encouraging developments within the segment. Aamal Medical delivered strong revenue and profit growth, supported by higher demand from both government and private sector customers. The business also remained focused on securing new opportunities by actively bidding for additional projects. Aamal Trading saw a more subdued market environment and modest decline in revenue and profit, but longer-term outlook for the segment remains constructive. The segment's businesses retained strong position in their markets and management remain focused on restoring momentum through customer service, product quality and continued responsiveness to changing market needs. Turning to Slide 8. The Property segment delivered another solid quarter in the terms of revenue growth, with revenue increasing by 4.6% to reach QAR 85.7 million. This was primarily due driven by the addition of Aamal Tower to the portfolio. City Center Doha also continued to benefit from resilient leasing activity and higher occupancy with steady cash generation supported by periodic rental uplifts and the continued -- and the contribution from new tenants. Aamal Real Estate recorded good revenue growth following the expansion of the portfolio through the Tower acquisition, offset with loss in revenue from the Bin Mahmoud Property due to ongoing renovation work there. Net profit for the segment was lower year-on-year, declining by 7% to reach QAR 62.8 million. This reflected higher maintenance costs relating to City Centre security systems as well as the financing cost linked to debt facility obtained for Aamal Tower acquisition. The overall outlook for the segment, nevertheless, remains positive, supported by modern and attractive rental portfolio with strong long-term fundamentals. Turning to Slide 9. Managed Services delivered mixed yet resilient performance in the first quarter, with revenue increasing by 4% to reach QAR 40.6 million. Segment profit declined slightly by 5.9% to reach QAR 3.9 million. But this still represented a stable overall outcome in the context of the current market conditions. The main positive contributor in the quarter was Maintenance and Management Solution, MMS, which recorded growth in both revenue and profits. This was supported by one-off and [ ad hoc ] project actively during the period as well as stronger project margins followed tighter control processes. Aamal Services also delivered modest growth, reflecting continued expansion in existing business and improved gross margins. Family Entertainment System -- Family Entertainment Center delivered a broadly stable revenue performance, demonstrating resilience despite the more challenging regional backdrop. Profitability was lower, owing mainly to higher depreciation costs. Overall, the segment continued to provide Aamal with useful diversification and steady exposure to service-led activity. Turning to Slide 11. And by way of summary, Aamal has made resilient start to 2026 despite challenging quarter. The group performance once again highlights the strengths of its diversified model with positive revenue growth delivered across 3 of the 4 operating segments, and the company continued to progress against strategic priorities. While trading and distribution was affected by difficult market conditions, the wider portfolio continued to demonstrate underlying strength. Property remains supported by higher quality asset and stable cash generation. Managed Services continues to benefit from operational disciplines and targeted project activity and industrial and manufacturing retain exposure to attractive construction and infrastructure-related demand. Looking ahead, the near-term outlook is currently more uncertain in lights of the current regional developments. Nevertheless, Aamal remain confident in Qatar's robust economic outlook and in the strengths of its own diversified platform with disciplined execution, clear strategic direction and the continued focus on long-term creation, the group believes it remains well positioned to navigate evolving conditions and pursue further growth opportunities. This concludes our presentation. Mr. Mohammad Arif and I now welcome -- will be very happy to take any questions you may have after we finish the Arabic presentation.

[Foreign Language].

Thank you everyone.

We will now start the Q&A which will be answered by [indiscernible] [Operator Instructions]. There no questions on the webinar so I'll hand it over to management for closing remarks.

Thank you, everyone, for attending the presentation. Since you don't have any questions, we can end this call, please.

Thank you, everyone, for coming.