Dubai – Business News Report|| The National Agricultural Development Company (Nadec) announced that its net profit fell by 72.5 percent during the third quarter of 2026. This decline occurred even as the company recorded a 7.8 percent increase in revenues. The results were heavily influenced by rising feed, nutrition materials, shipping costs, and additional fees linked to regional maritime disruptions.
Financial Performance Breakdown
In a disclosure to the Saudi Stock Exchange (Tadawul), Nadec stated that net profit for the quarter stood at 30.4 million riyals, equivalent to 8.1 million dollars. This compares with 110.67 million riyals, or 29.5 million dollars, in the same period last year. Revenues rose to 909.72 million riyals, or 242.6 million dollars, up from 843.61 million riyals, or 225 million dollars, previously.
The company explained that the cost of sales ratio to revenues increased by 7.9 percentage points, pressuring profits. The financial impact of this exceptional cost increase reached approximately 56 million riyals, or 14.9 million dollars, during the quarter. Sales and marketing expenses also rose by 12.9 percent, while treasury income dropped by about 10.93 million riyals, or 2.9 million dollars, due to lower Murabaha income.
Sectoral Growth Offsets Declines
Gross profit decreased by 16.8 percent to 242.61 million riyals, or 64.7 million dollars. Operating profit fell sharply by 77.5 percent to 23.82 million riyals, or 6.4 million dollars, compared to 105.91 million riyals, or 28.2 million dollars, in the prior year quarter. However, protein sector sales grew by 100.2 percent, and dairy and food processing sales rose by 1.15 percent. These gains partially offset a 12.31 percent drop in agricultural sector sales.
On a quarterly basis, net profit fell 52.9 percent compared to the second quarter, when it was 64.56 million riyals, or 17.2 million dollars. Nadec attributed this to higher sales costs and marketing expenses, noting the previous quarter benefited from reversing impairment losses on receivables worth 33.35 million riyals, or 8.9 million dollars, which were non-recurring gains.
Nine-Month Results and Other Comprehensive Loss
For the first nine months of the year, net profit declined 42.7 percent to 188.66 million riyals, or 50.3 million dollars, against 329.35 million riyals, or 87.8 million dollars. Revenues grew slightly by 0.69 percent to 2.704 billion riyals, or 721.1 million dollars. Gross profit fell 16.8 percent to 774.51 million riyals, or 206.5 million dollars, while operating profit dropped 36.4 percent to 200.08 million riyals, or 53.4 million dollars.
The company cited total financial impacts of 107.1 million riyals, or 28.6 million dollars, from feed and shipping costs. It also noted increased losses from joint venture investments and reversed old receivable impairments totaling 73.03 million riyals, or 19.5 million dollars. Additionally, an Islamic zakat provision reversal of 9.23 million riyals, or 2.5 million dollars, was recorded. The company reported a comprehensive income loss attributable to shareholders of 24.7 million riyals, or 6.6 million dollars, due to fair value declines in Arab Mills shares, resulting in a 55.13 million riyal, or 14.7 million dollar, loss in other comprehensive income.
This story was produced in the newsroom from the disclosed sources named above.
