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

Hello, everyone, and welcome to Mekdam Holding Group Call. Please note that this call is being recorded. [Operator Instructions] I will now hand the call over to our moderator, Dana.

Hello, everyone. This is Dana Al Sowaidi from QNB Financial Services. I would like to welcome everyone to Mekdam Holding Group's Second Quarter 2026 Financial Results Conference Call. On this call from management, we have Ehab Naser, Group CEO; Bara Sami, Group GM; and Banan Serhan, Group CFO. We will conduct this conference call with the management reviewing the company's results, followed by a Q&A session. I will now turn the call over to Banan.

Hello. First of all, hi, Dana, and hi, everyone. It's nice to meet you again in the -- for reviewing the second quarter for the year 2026. As a start, and despite all the challenges that the regional has gone through, we would like to say and emphasize on that the group has recorded a revenue -- an increase actually in its revenue compared to the same period last year by 10.3%, where it jumped from QAR 297.4 million to QAR 328.1 million, reflecting a continued demand across its technology, engineering and manpower services. Also, I would like to say that the business also maintained a strong commercial momentum with its projects on hand totaling QAR 3.1 billion, where QAR 1.6 billion of it is remaining work to be billed during the coming years. Also, we would like to draw the attention that Mekdam has secured an amount of new contracts amounting to QAR 254.8 million. And we have in our pipeline, which is under evaluation, another QAR 2.6 billion, which will boost the group for a continuing and continued growth. Also, we'd like to say that our customer retention remained high at approximately 90%, underscoring the strength of our long-term relationship with our clients. During this period, the gross profit reached to QAR 45.2 million. Our operating profit amount reached to QAR 17.3 million, and our net profit reached to QAR 12.2 million. The decline in margins primarily reflects higher procurement, logistics, subcontracting, and financing costs rather than any weakening in the group's underlying operations. Management continues to implement its cost optimization initiatives and expect the profitability to improve as the project execution progress, procurement conditions normalize and operational efficiencies from recent investments are realized. The group also recorded a significant improvement in its operating cash flow, where it jumped from a negative QAR 24.1 million in the first half of 2025 to a positive QAR 11.3 million in June 2026. Also the group maintains a solid financial position, where its total assets at QAR 543 million, the shareholders' equity at QAR 259 million, and our share capital at QAR 170 million. Amount following the bonus share issuance approved by the shareholders. Mekdam continues to benefit from a diversified business model and a healthy portfolio of long-term contracts serving government, semi-government, and leading industrial clients. The group remains focused on disciplined project execution, operational excellence, digital transformation and prudent financial management. Also, we are looking ahead, the management remains confident in the group's outlook, supported by QAR 3.1 billion of projects on hand, QAR 1.6 billion of remaining work, and QAR 254.8 million of contracts secured in the first half. Now we would like to -- as what we have said, we would like to leave now the floor for the Q&A...

[Operator Instructions] There are no further questions at this time. I will now hand the call over to the management for closing remarks.

Okay. Since I believe no questions raised from anyone, I believe this is a closure. And we are also happy to answer if anybody pops up for any question.

Thank you for joining the call today. You may now disconnect