Oman Chlorine S.A.O.G. (OCHL) Earnings Call Transcript & Summary

Good morning, everyone. So this is our presentation for H1 2026. So we'll go through the agenda. I'll take you an overview about Oman Chlorine if you're a new investors. Then we'll highlight on the major shareholders. We'll talk about our product and capacities. We'll give an overview about our subsidiaries in UAE and Qatar, including the shareholders representatives. Then after that, we'll take you through the financial performance, and then we'll end up with Q&A. Oman Chlorine was established in '97 as first manufacturer of Chlorakali. In 2007 and 2008, we awarded for the best 5 factories in Oman. In 2021, we did an expansion. We increased the capacity of the main plant by 60%. In 2022, we built a new plant for calcium chloride with a capacity of 80 metric ton a day. In 2025, we added flaking capacity. It was commissioned on 1st of October 2025. We have very good HSC track records. We produce chemicals that goes into oil and gas and also water treatment. The major shareholders that own above 5% we have Al Anwar Investments, they own 22.012%. We have Bank Muscat, they own 11.067%. We have Social Protection Fund, they own 9.5%. We have Oman International Petroleum and Energy Services, they own 9.1%, and we have Ikthiar Trading & Contracting, they own 5.16%. We produce 2 main products, which is hydrochloric acid and caustic soda. And then we convert hydrochloric acid into a calcium chloride and also caustic soda into caustic soda flakes. The main application of our products, hydrochloric acid goes into oil and gas. It goes into enhanced oil recovery, mainly well stimulation or acid treatment. Calcium chloride goes into drilling fluid as a drilling source. We produce small quantities of sodium hydrochloride that goes into water treatment and purification of water. Then the caustic soda, if it is liquid or flake, it goes into other product as a raw material to create a secondary component that turn into [indiscernible] plastic and other product in petrochemicals. Oman Chlorine subsidiaries, we have 2 plants in the region, 1 plant in UAE under name of Union Chlorine and we own 72.1%. We produce similar products as Oman Chlorine produce hydrochloric acid, caustic soda and calcium chloride. And Union Chlorine also is managed by Oman Chlorine since we have the majority in that company. This is the shareholder structure [indiscernible] 71.93%, 11.36% owned by Union Chlorine Holding and 16.71% owned by Horizon Energy. Then we have another company in Qatar under the name of Gulf Chlorine. The capacity is similar to the plant in UAE, 72.5% and produce similar products, caustic soda hydrochloric acid and sodium hypochlorite. But the difference between the JV, the subsidiary in UAE and subsidiaries in Qatar. In Qatar, we have a JV that we produce calcium chloride with other partners under the name of United Chemical. Gulf Chlorine is managed by Oman Chlorine. This is the structure in Qatar. So in Qatar, Gulf Chlorine own 51% and [indiscernible] we own 49%. Then on the calcium chloride, the JV that Gulf Chlorine own under name of United Chemical. Gulf Chlorine own 35% and our Qatari partner [indiscernible] own 65%. Then go through the financial and future outlook. I will hand over the presentation to our group CFO, Mr. Balakrishnan.

The net profit for this half - half yearly profit was negative by OMR 0.303 million and you can see in this slide, we have dividend trend for the past 5 years and the also historical prices movement. Turning to the financials. Oman Chlorine achieved revenue of OMR 3.1 million for the first six months. 12-month's figure of OMR 8.62 million last year. EBITDA come down to OMR 0.605 million and net profit is negative OMR 0.303 million. EBITDA margin has shrunk from 26% to 16%. On the group company level, the total revenue achieved was OMR 10 million, OMR 10.6 million as against last 12 months figure of OMR 25 million and EBITDA was OMR 2.5 million as against OMR 1.8 million for the last year and the profits as either loss or [indiscernible] negative OMR 0.474 million for the first six months as against last year's OMR 1.6 million. This slide shows the revenue, EBITDA and the profit or loss figures from the past five years. We see that compared to last year the revenue [indiscernible] 56.76%; EBITDA dropped by 73% and PAT declined significantly. We have been able to maintain the capacity position at the same levels as earlier years. Sales volume is primarily related to the ongoing regional situation with impacting of demand. We have been optimizing our cost control in terms of administrative and cost controlling across the [indiscernible] lower than earlier years. We wanted to remain focused on maintaining a high capacity and building strong [indiscernible] once this conflict is over, we can come back to the market. On the group level, revenue decreased by 60% as compared to last year. EBITDA [indiscernible] again by same 60.5%. The international crisis in the caustic [indiscernible] last year. Sales volume has dropped due to the conflict. Both subsidiaries, parent companies have recorded [indiscernible] six months. We are very confident that once regional conflicts subside, we will be able to recover our revenue to the previous levels. These are remaining build for custom [indiscernible] profitability in the upcoming periods. Just to know primary - the current loss was primarily driven by temporary geopolitical disruptions affecting trade, [indiscernible] and customer demand. [indiscernible] supported by company's strong market presence, enhanced customer relationship and [indiscernible] We are continuing to monitor the oil fluctuations and price fluctuations globally. The group continues to remain optimistic for product demand and price realization in the near future for the oil and gas continue to revise. Any questions, please let us know.

So we'll open the floor to Q&A.[Operator Instructions]

I think there is no question. We can conclude.

So if we don't have any questions, we conclude our session today. And hopefully, we'll see you in the next investor sessions next year. Thank you very much.