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Red Sea Global recorded a sharp rise in its net losses during the third quarter of 2026, by 1765.15% year-on-year, with declining revenues and low profit margins, along with higher financing costs and expected credit loss provisions.
The company’s preliminary financial results, published on the “Tadawul” website, revealed on Thursday that the net losses attributable to shareholders increased to 31.2 million riyals, compared to 1.67 million riyals in the same period of 2025, an increase of 85.1% compared to the second quarter of this year, which recorded losses of 16.86 million riyals.
Declining revenue puts pressure on company results
The company attributed the exacerbation of its annual losses to the decline in total profit as a result of the decline in revenues and the implementation of a number of projects with lower profit margins, in conjunction with the increase in financing costs due to increased borrowing, as well as the increase in the expected credit loss allocations associated with the obsolescence of retained dues and contract assets.
Revenues of the Red Sea International fell during the third quarter by 61.95%, to reach 375.17 million riyals, compared to 986.02 million riyals during the corresponding quarter of last year, affected by the slow pace of implementation of projects.
Revenues of the Red Sea Globally fell in the third quarter by 61.95%, to reach 375.17 million riyals
Total profit decreased by 54.97% to SAR 39.87 million, compared to SAR 88.55 million a year ago, while operating results turned into a loss of SAR 33.62 million, after the company achieved operating profit of SAR 25.04 million in the third quarter of 2025.
High losses on a quarterly basis
On a quarterly basis, the company’s losses increased by 85.1%, due to the decline in total profit and the decline in revenues, in addition to the increase in financing burdens resulting from the increase in the volume of borrowing, as well as the growth of sales, public and administrative expenses.
Revenue decreased by 38.3% compared to the second quarter of 2026, while the total profit decreased by 31.81% to SAR 39.87 million, compared to SAR 58.48 million, and the operating loss increased to SAR 33.62 million, compared to an operating loss of SAR 15.17 million in the previous quarter.
The losses of the nine months exceed 45 million riyals
Financial pressures extended to the results of the first nine months of 2026, as the net losses of the "Red Sea World" jumped by 221.55%; to reach 45.52 million riyals, compared to losses of 14.16 million riyals during the corresponding period of 2025.
The company’s revenues during the period decreased by 34.53% to 1.61 billion riyals, compared to about 2.47 billion riyals a year ago, as a result of the relative decline in the pace of implementation of projects, while the total profit fell by 35.71% to 174.57 million riyals, compared to 271.52 million riyals.
The gross profit margin during the first nine months was 10.81%, compared to 11.01% in the same period last year, affected by the decline in recognized revenues and the decline in profit margins in the implemented projects.
The company also turned to recording an operating loss of 34.33 million riyals, compared to operating profits of 67.87 million riyals during the comparative period.
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