ARTEX Industrial Investment Co. releases a correction announcement concerning a prior disclosure.
- Ayda Salem
- 4 days ago
- 2 min read
April 1, 2025
1- Operating loss amounted to SAR -13.29 million, marking a 67.06% decrease.
2- Attention
1- We would like to draw attention to Note (31), which states that during the current year, the Group revised disclosures regarding potential contractual obligations dating back to 2016. These obligations pertain to a guarantee provided to the Saudi Industrial Development Fund for a SAR 100.8 million loan to Al Reef Sugar Refining Company, which was not previously disclosed in financial statements. A provision for this obligation was recognized in the current year following a repayment demand from the Saudi Industrial Development Fund (Note 8/3). Additionally, due to management’s assessment of the Group’s inability to recover its investment in Al Reef Sugar Refining Company, a loss of SAR 42 million was recorded due to changes in the fair value of the investment (Note 8/2). This loss resulted from Al Reef Sugar Refining Company's failure to commence operations and difficulties in determining a fair valuation of its net assets. Our opinion remains unchanged in this regard.
2- We would like to draw attention to Note 2/5/2 concerning the going concern assumption, which highlights that the Group incurred operating losses and negative cash flows from operations in the year ending December 31, 2024. The note also acknowledges the repayment demand from the Saudi Industrial Development Fund for the SAR 100.8 million guarantee provided for Al Reef Sugar Refining Company.
Management has assessed the impact of this demand, prepared a 2025 budget, and developed cash flow projections for the next twelve months. It also notes the availability of undrawn bank facilities supporting the Group’s ability to meet its obligations. Furthermore, the Group maintains strong working capital, with current assets exceeding current liabilities at a ratio of 2:1.
Accordingly, management believes there are no material uncertainties affecting the Group’s ability to continue operations in the foreseeable future. Our opinion remains unchanged in this regard.
The provision for third-party liability guarantees amounting to SAR 100 million has been reclassified from operating expenses to non-operating expenses.