AFG International Co (Cenomi Retail) Announces Its Financial Results for the Period Ending on 31 March 2026 (Three Months)

• KSA retail revenues declined marginally by 0.4% YoY to SAR 947.1 million. Like-for-like sales also decreased 0.4% YoY; despite the impact of the geopolitical situation on ZARA and Inditex performance due to logistics disruption, the decline was contained by a stronger contribution from multimedia, sports, beauty, lifestyle and other fashion categories.

• International retail revenues rose by 15.4% YoY to SAR 347.8 million, driven by strong demand across key CIS markets. The international portfolio delivered like-for-like growth of 18.4%.

• F&B segment revenues decreased by 12.9% YoY to SAR 69.7 million, reflecting a temporary shift in demand during Ramadan toward Arabic desserts, temporary geopolitical-related trading pressures that affected the availability of raw material shipments, and the planned exit of five brands in Q4-25. Subway continued to perform well, delivering like-for-like growth of 9.1%.

• Online revenues increased 3.7% YoY to SAR 117.0 million, driven by strong momentum across KSA retail and international segments, which increased by 6.1% and 36.5%, respectively.

• A decrease in gross profit of 14.6% YoY to SAR 128.6 million, primarily due to seasonal promotions, tighter logistics conditions that affected shipment volumes and fulfilment flexibility during the period of geopolitical tension, and the delayed spring affected sales of the spring/summer collection, as customers shifted to discounted winter items instead.

• An increase in SG&A expenses of 2.2% YoY to SAR 95.2 million, primarily due to higher marketing spend on the Ramadan campaign and a slight increase in shipping and logistics costs.

• A decrease in other operating income, from SAR 32.8 million to SAR 15.3 million, mainly due to the occurrence of SAR 21.8 million non-recurring capital gains in prior year.

• A decrease in other operating expenses to SAR 2.9 million, compared to SAR 6.9 million in Q1-25, mainly due to the absence of asset write-offs related to the non-core brand divestment program recorded in the prior-year period.

• An increase in finance cost to SAR 87.4 million, compared to SAR 58.2 million in Q1-25 primarily due to interest on the ENBD loan and the shareholder loan.

• KSA retail revenues increased by 7.3% QoQ to SAR 947.1 million, due to end of season promotion during January and February, as well as a stronger contribution from multimedia, sports, beauty, lifestyle, and other fashion categories, which recorded like-for-like growth of 23.1%. March included the holy month of Ramadan, which typically supports stronger retail activity, but trading was softer than usual due to geopolitical tensions which impacted ZARA and Inditex available shipments and the fact that the month included a single payroll cycle.

• International retail decreased by 27.6% QoQ to SAR 347.8 million as Q4-25 benefited from year-end promotional activity, which is typically a peak trading period. Q1-26 was also modestly affected by temporary logistics-related pressures on shipments and fulfillment flexibility arising from the regional geopolitical situation.

• F&B segment revenue decreased by 8.2% QoQ to SAR 69.7 million, reflecting the Ramadan-driven shift in consumer preferences toward Arabic desserts, temporary trading pressures arising from the regional geopolitical situation which impacted the availability of raw material shipments, and the non-recurrence of revenues from five brands exited during Q4-25.

• Online revenue declined 6.3% QoQ, mainly due to logistics pressures affecting orders to be fulfilled from outside the Kingdom of Saudi Arabia, as well as international flight cancellations that impacted international sales.

• Gross Profit decreased from SAR 162.8 million to SAR 128.6 million mainly impacted by longevity of the end of seasons promotions period in Q1-26 in comparison to Q4-25 in addition to the geopolitical situation.

• A decrease in SG&A from SAR 123.8 million to SAR 95.2 million, despite higher marketing expenses and shipping costs, due to the reduction in some provisions and professional fees.

• A decrease in other operating income from SAR 23.8 million to SAR 15.3 million, mainly due to a normal reduction in income from owner of new malls and the absence of non-recurring landlords’ discounts that occurred in Q4-25

• A decrease in other operating expenses from SAR 65.6 million to SAR 2.9 million, due to higher asset write-offs and non-recurring tax expenses recorded in Q4-25.

• Finance costs declined to SAR 87.4 million in Q1-26, compared to SAR 97.2 million in Q4-25 due to settling some international loans.

• The occurrence of the SAR 120.0 million goodwill impairment recognized in Q4-25.

We draw attention to Note (3-2) of the accompanying interim condensed consolidated financial statements, which indicates that the Group incurred a loss of SAR 47 million for the period ended 31 March 2026, and as of that date it recorded accumulated losses of SAR 2,161 million. In addition, the Group’s current liabilities exceeded its current assets by SAR 1,547 million as of 31 March 2026, and as of that date total liabilities exceeded its total assets by SAR 1,532 million. These events or conditions, along with other matters as set forth in details in Note (3-2) of the accompanying interim condensed consolidated financial statements, indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. Our conclusion is not modified in respect of this matter.