Methanol Chemicals Co. announces its Annual Financial results for the period ending on 2025-12-31

Methanol Chemicals Co. (Chemanol) reported a widened net loss of SAR 479.7 million for the fiscal year 2025, a 72.2% increase in losses compared to the previous year. Revenue declined 11.9% to SAR 621.9 million, driven by a 10% drop in average selling prices and a 2% decrease in sales volumes amid weaker market conditions.
The company's financial performance was severely impacted by an SAR 280.4 million non-cash impairment charge on the assets of subsidiaries (ACC and GCI) and higher production costs due to rising natural gas feedstock prices. Operational losses at the parent company level reached SAR 162.2 million, accounting for 34% of the total net loss.
Accumulated losses have reached SAR 551.3 million, representing 82% of the company's capital, triggering an auditor’s "Emphasis of Matter" regarding material uncertainty over the group's ability to continue as a going concern. The group’s current liabilities exceed its current assets by nearly SAR 330 million, prompting legal action against former board members regarding the circumstances of the subsidiary acquisitions.
To address the solvency crisis, the company has scheduled an Extraordinary General Assembly for July 1

Element List	Current Year	Previous Year	%Change
Sales/Revenue	621.93	705.57	-11.85
Gross Profit (Loss)	8.05	93.3	-91.37
Operational Profit (Loss)	-500.66	-247.12	102.6
Net Profit (Loss) Attributable to Shareholders of the Issuer	-479.66	-278.59	72.17
Total Comprehensive Income Attributable to Shareholders of the Issuer	-477.2	-278.15	71.56
Total Shareholders Equity (after Deducting Minority Equity)	285.21	762.41	-62.59
Profit (Loss) per Share	-7.11	-4.13
All figures are in (Millions) Saudi Arabia, Riyals

Element List	Amount	Percentage of the capital (%)
Profit (Losses) Resulting From The Change In Investment Propertie’s Fair Value	-	-
Accumulated Losses	551.3	82
All figures are in (Millions) Saudi Arabia, Riyals

Element List	Explanation
The reason of the increase (decrease) in the sales/ revenues during the current year compared to the last year	The decrease in revenue during the current year as compared to the previous year is primarily attributable to 10% decline in average selling prices and 2% decline in the quantities sold.
The reason of the increase (decrease) in the net profit during the current year compared to the last year is	The net loss for the current year increased compared to the previous year primarily due to the following factors: 1. Parent Company (Chemanol) operational performance The Parent Company reported operating losses of SR 162.2 million during 2025, representing 34% of the total net loss for the current year (SR 479.7 million), compared to SR 100.6 million in the previous year. This was mainly driven by: - A decline in revenue due to a 10% decrease in average selling prices and a 2% reduction in sales volumes. - An increase in feedstock (natural gas) prices at the beginning of the year, which led to higher production costs. 2. Impact of subsidiaries (ACC and GCI) The remaining 66% of the group’s net loss (SR 317.5 million) is attributable mainly to the impact of subsidiaries, as follows: - Continued losses from subsidiaries, with combined losses of SR 42.2 million during the current year (compared to SR 42.7 million in the previous year); and - Recognition of an impairment charge of SR 280.4 million in Q2 2025 relating to the assets of the subsidiaries (ACC and GCI), following an assessment of recoverable amounts; and - During Q2 2025, a provision of SR 94.5 million was recognized against receivables from subsidiaries relating to working capital support and feedstock supply. As part of the year-end consolidation and audit finalization process, management reassessed the treatment of these balances at the Group level and determined that the related provision should not be reflected in the consolidated full-year results, as the underlying balances represented intra-group amounts subject to consolidation adjustments. Accordingly, the provision recognized during the interim period was reversed in Q4 2025. This reversal was made in consultation with the external auditor and had no net impact on the consolidated full-year results. Overall, the increase in net loss reflects both weaker market conditions, impacting the Parent Company’s performance, and the significant non-cash impairment recognized in respect of subsidiary assets.
Statement of the type of external auditor's report	Unmodified opinion
Comment mentioned in the external auditor’s report, mentioned in any of the following paragraphs (other matter, conservation, notice, disclaimer of opinion, or adverse opinion)	Emphasis of Matter: We draw attention to Note 3 to the consolidated financial statements, which indicates that the Group incurred a net loss of SR 542.2 million for the year ended 31 December 2025. As at that date, the Group’s current liabilities exceeded its current assets by SR 329.97 million and the Group’s accumulated losses exceeded half of its share capital. The Group is also subject to ongoing legal proceedings that have resulted in significant liabilities being recognized in the consolidated financial statements. These events or conditions, together with other matters described in Note 3, indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. The Group’s ability to continue as a going concern depends on the successful implementation of the measures described in Note 3, including the completion of the planned right-issue. The outcome of these measures remains uncertain. The consolidated financial statements have been prepared on a going concern basis. Our opinion is not modified in respect of this matter. Other legal and regulatory requirements: As described in Note 3 to the accompanying consolidated financial statements, the accumulated losses of the Group exceeded half of the Parent Company’s share capital as at the reporting date. As required by Article 132 of the Saudi Arabian Regulations for Companies’ Law, the Board of Directors is required, within 60 days from the date on which it becomes aware of such losses, to announce the losses and its recommendations in respect thereof and, within 180 days from that date, to call for an extraordinary general assembly meeting to address the solvency issue and consider the continuation of the Parent Company through measures necessary to resolve such losses or the dissolution of the Parent Company. As of the date of this report, the extraordinary general assembly meeting had not yet been convened .
Reclassification of Comparison Items	Certain corresponding figures have been restated where considered necessary for better presentation. Please refer to Note 38 for details of the restatement of comparative amounts.
Additional Information	In conjunction with the announcement of the financial results for the fiscal year 2025, the Parent Company would like to announce that accumulated losses as of 31 December 2025 amounted to SAR 551.3 million, representing 82% of the Company's capital. Majority of these losses have resulted from the negative impact of the acquisitions. The Board of Directors, in its commitment to protecting shareholders' rights and interests, had the Company appoint a specialized law firm to examine its legal position on two acquisition deals (ACC and GCI) and the circumstances surrounding their conclusion during the previous board term. In this regard, the Company has already initiated certain legal actions against those responsible for these two acquisitions. In addition, further legal and regulatory measures will be taken later against members of the previous Board who held direct or indirect executive powers, based on the findings of the Forensic Investigation that was conducted and finalized by a specialized consulting firm (Deloitte) and the results thereof were published on Tadawul website on 7 December 2025. Actions Taken and Important Dates: According to Article (132) of Companies Law, if a joint-stock Company's losses reach half of its issued capital, the Board of Directors must disclose this and its recommendations regarding these losses within sixty days of becoming aware of this amount. The Board of Directors must also convene an Extraordinary General Assembly within one hundred and eighty days of becoming aware of this to consider the continuation of the Company, take any necessary measures to address these losses, or dissolve the Company. The Company's Board of Directors received official notification on 10 August 2025, stating that the accumulated losses have reached this level, due to the following reasons: - Recording losses resulting from a decline in the value of fixed assets and goodwill of the ACC and GCI, which were acquired during the previous board’s term - Financial results were also impacted by the additional provisions relating to the acquired companies and the operational losses of the group. Accordingly, we would like to indicate the following dates: - The Company announced its plan for capital restructuring on 9 October 2025. - The Company amended the recommendation to Extraordinary General Assembly dated 25/12/2025 related to the capital restructuring. - The file was submitted to CMA on 4 January 2026 and CMA issued its approval on the file of Capital reduction on 7 May 2026. - Following the approval of the Capital Market Authority, the Company announced on 21 June 2026 the invitation to convene the Extraordinary General Assembly Meeting on Tuesday, 14 July 2026, to approve the reduction of the Company's share capital. It is worth noting that the procedures and instructions for listed companies with accumulated losses of 20% or more of their capital will be applied.