Methanol Chemicals Co. presents its annual financial figures for the period ending December 31, 2024.

April 2, 2025 - The decline in revenue for the current year compared to the previous year is primarily due to a 14% drop in the average selling prices of major products, despite a 13% increase in sales volume.

The increase in losses for the current year compared to the previous year is mainly attributed to the rise in feedstock (NG) costs, announced at the beginning of 2024, along with the significant 14% decline in the average selling prices of major products. This price drop persisted despite a 13% increase in sales volume over the same period. Notably, the decline in selling prices exceeded the decrease in the cost of major raw materials, further impacting profitability. Despite these challenges, Chemanol, as the parent company, managed to reduce its operational losses by 11% compared to the previous year, reflecting improved performance independent of the group's overall results.

However, the Group’s losses significantly increased due to the acquisition of Aldar Chemicals and Chemical Industries Company during the 2024 fiscal year. The poor financial performance of these entities and the absence of future cash flow projections resulted in the complete write-off of goodwill, amounting to SAR 127 million as of December 31, 2024, exacerbating Chemanol's financial challenges.

Emphasis of Matter:

We draw attention to Note 3 in the consolidated financial statements, which states that the Group incurred a net loss of SAR 286.2 million for the year ended December 31, 2024, and that, as of that date, its current liabilities exceeded its current assets by SAR 168.5 million. These factors, along with other matters detailed in Note 3, indicate a material uncertainty that could cast significant doubt on the Group’s ability to continue as a going concern. The Group’s ability to sustain operations depends on the completion of a rights issue planned for 2025 and the restructuring of certain financing facilities. The Parent Company has assessed that these measures will be achieved within the current year and has accordingly prepared these consolidated financial statements on a going concern basis. Our opinion remains unmodified regarding this matter.

Throughout the year, given the volatility in the petrochemical sector and the growing uncertainty around short- and medium-term demand for certain products and their forecasted prices, Management has reassessed its business plan based on the latest available data. Consequently, the Company has recorded an impairment loss of SAR 2.04 million against property, plant, and equipment, as well as SAR 127.03 million against goodwill for the recently acquired subsidiaries, Addar Chemicals Company and Global Company for Chemicals Industries Ltd.

Additionally, following the negative impact of the two acquisitions on the company's financial results, loan repayments for the recently acquired subsidiaries have been suspended. This decision was made to allow the Group’s Board of Directors to reassess the investment and develop a corrective strategy that ensures the continuity and growth of Chemanol’s operations in alignment with its strategic objectives.

Basic and Diluted Loss per Share:

Basic loss per share is calculated by dividing the loss attributable to equity holders of the parent company by the weighted average number of outstanding ordinary shares during the year. Diluted loss per share is determined by dividing the loss attributable to ordinary equity holders of the parent company by the weighted average number of outstanding ordinary shares, including any that would be issued upon the conversion of dilutive potential shares. Since there are no dilutive instruments outstanding, the basic and diluted loss per share figures are identical.