Mekdam Holding Group - Q.P.S.C. (MKDM) Earnings Call Transcript & Summary

Hello, and welcome to Mekdam. Please note that this call is being recorded. [Operator Instructions] I'd like to hand over the call now to our moderator, Roy Thomas. Please go ahead. Thank you.

Thanks, Gail. Hello, everyone. This is Roy Thomas from QNB Financial Services. I want to welcome everyone to Mekdam Holdings Group's First Quarter 2025 Financial Results Conference Call. On this call from Mekdam Holding Group, we have Ehab Naser, Chief Executive Officer; Bara Sami, Group GM; and Banan Serhan, the Group CFO. We will conduct this conference call with management first reviewing the company's results, followed by Q&A. I will turn the call now over to Ehab Naser. Go ahead, Ehab.

Thank you, Roy, for your introduction. And thank you, everybody, for attending our Q 2025 conference call. I would like to give you just a quick brief about our performance during the first quarter. The group performance for the first quarter of 2025 demonstrated notable improvement across several key financial indicators, reflecting the company's continued positive momentum. The group succeeded in increasing its gross profit margin by 15.1% alongside with a 9.1% growth in the net profit margin, indicating enhanced operational efficiency and significant reduction in finance costs. This improvement reflects a strong financial structure and reduced reliance on debt. Net profit attributable to shareholders of the company reached QAR 11.4 million for the period ended March 31, 2025, compared to QAR 10.5 million for the same period in 2024, representing a growth of 8%. Earnings per share rose to QAR 0.7, up from QAR 0.66 in the corresponding period last year. During 2025, Mekdam Holding Group was able to sign new contracts with total value of QAR 250 million. The total value of contracts being implemented, which amounted to about QAR 2.7 billion, while the value of the remaining work amounted to about QAR 1.6 billion. With respect to sales proposals, the total offer submitted and being negotiated with our customers amounted QAR 2.7 billion. The expected success rate around historically between 20% to 30%. These indicators are key factors in building revenue expectation and net profits in the future. As of March 31, 2025, the balance sheet of Mekdam Holding Group reflected strong financial performance, which -- with a notable growth in both total assets and shareholders' equity. This underscores the strength of the group financial position and the continued momentum in the operational expansion. The total assets reached QAR 430 million compared to QAR 393 million as of December 2024, an increase of 9.2%. This growth was primarily driven by a significant rise in current assets, which grew approximately 12%, indicating an expansion in the projects under execution and overall increase in operational activity. The group also maintained a solid liquidity position with current assets accounted for 79% of the total assets. The current ratio, which represents the current assets over the current liability, stood at 2.2x, reflecting a strong ability to meet the short obligation and sustain operational readiness. This is the quick brief. And now we are leaving the floor for the Q&A. Thank you.

[Operator Instructions] At this moment, there are no raised hands for Q&A. So we will now proceed to our closing remarks, and I will now turn the call over back to our moderator, Roy Thomas. Thank you.

All right. Thank you. Yes. If there are no questions from others. I'd like to raise one question. And this is regarding your pipeline projects. What I've seen in your presentation as well is that you have the most potential, at least the way I see it, coming from Mekdam Steel as opposed to others. Can you clarify on this and give a few more details into where the potential business is going to come for the next quarter?

Roy, this is Banan speaking, the group CFO. Now Mekdam Steel, to be honest, had a boost this year and was awarded with a good, what we call it, like big contracts in Saudi Arabia, which they boosted our revenue and our business, mainly for the steel business. And we are also expecting additional -- to be honest, additional projects to be awarded in the coming couple of quarters, which will maybe double the size of that business, the Mekdam Steel business.

That's good to know, Banan. Can you give a little more details on, let's say, potential from your Technical Services and others?

Technical Services, we are actually with the Q companies like QatarEnergy, Qatar Petroleum, Ashghal, okay? All -- most of the governmental parties, we are into them. And we -- our contracts mainly are with these reputable governmental parties. And it depends on tenders, what you call it, that they are being issued and released during the year. Based on that, we expect, which is our portion usually, which Mr. Ehab mentioned, like 20% to 30% of what is being produced or released in the market. Usually this is our share of it based on history. So we expect this is what to get out of the market, win tenders.

Thanks, Banan. And if there are no further questions, we'd like to thank the management for the results update and answering the queries. And we look forward to speaking to you all for the second quarter 2025 results conference call. Thank you.

Thank you.

Thank you. Thank you, everybody.

Thank you, everyone, for joining. And that concludes today's call. You may now all disconnect. Have a nice day ahead, everyone.