Q2 2026 SAL Saudi Logistics Services Co Earnings Call

August 3, 2026

Speaker #2: You have joined the meeting as an attendee and will be muted throughout the meeting.

Speaker #3: Good morning, good afternoon, ladies and gentlemen. Thank you for joining us today. This is Ali Abdel and, on behalf of our company, I would like to welcome you to the SAL second quarter earnings call.

Ali Adel: Good morning, good afternoon, ladies and gentlemen. Thank you for joining us today. This is Ali Adel. On behalf of Webcom Capital, I would like to welcome you to SAL's Q2 earnings call. We have today from the management team, Omar Hariri, the company's CEO, Mr. Haydar Yuksel, the company CFO, and Abdel Rahab, the IR director. As usual, the management will start with a presentation for the key highlights of the Q2. It will be followed by the Q&A session. Without any further delay, I'll be handing over the call to the management team. Please go ahead.

Ali Adel: Good morning, good afternoon, ladies and gentlemen. Thank you for joining us today. This is Ali Adel. On behalf of Arqaam Capital, I would like to welcome you to SAL's Q2 earnings call. We have today from the management team, Omar Hariri, the company's CEO, Mr. Haydar Ucar, the company CFO, and Abdel Wahab, the IR director. As usual, the management will start with a presentation for the key highlights of the Q2. It will be followed by the Q&A session. Without any further delay, I'll be handing over the call to the management team. Please go ahead.

Speaker #3: We have today, from the management team, Omar Hariri, the company CEO; Mr. Haidar Yukar, the company CFO; and Abdul Wahab, the IR Director. As usual, the management will start with a presentation of the key highlights of the second quarter, and then it will be followed by a Q&A session.

Speaker #3: So, without any further delay, I will be handing over the call to the management team. Please go ahead.

Speaker #4: Thanks, Heidi. Good afternoon, everyone, and thank you for being here with us. Alhamdulillah, another record result quarter for SAL, with also the most recent news that we have just announced: the completion of the acquisition of AV Partner Liage just yesterday.

Abdel Rahab: Thanks, Ali. Good afternoon, everyone. Thank you for being here with us. Alhamdulillah, another recorded result quarter for SAL, with also the most recent news that we have just announced the completion of the acquisition of Aviapartner Liège just yesterday. Before we begin, I would like to draw your attention to the disclaimer displayed on the screen. Today's presentation may include forward-looking statements that are based on current expectations and may involve some risks and uncertainties that could cause actual results to differ materially. More details is available on the disclaimer section of our presentation that is also available online right now. I would also take the opportunity to invite everyone to visit our SAL upgraded investor relations website at ir.sal.sa. The website provides easy access to our financial reports, presentations, announcements, calendar events, and many other resources.

Abdul Wahab: Thanks, Ali. Good afternoon, everyone. Thank you for being here with us. Alhamdulillah, another recorded result quarter for SAL, with also the most recent news that we have just announced the completion of the acquisition of Aviapartner Liège just yesterday. Before we begin, I would like to draw your attention to the disclaimer displayed on the screen. Today's presentation may include forward-looking statements that are based on current expectations and may involve some risks and uncertainties that could cause actual results to differ materially. More details is available on the disclaimer section of our presentation that is also available online right now. I would also take the opportunity to invite everyone to visit our SAL upgraded investor relations website at ir.sal.sa. The website provides easy access to our financial reports, presentations, announcements, calendar events, and many other resources.

Speaker #4: Before we begin, I would like to draw your attention to the disclaimer displayed on the screens. Today's presentation may include forward-looking statements that are based on current expectations and may involve some risk.

Speaker #4: That could cause actual results to differ materially. More details are available in the disclaimer section of our presentation, which is also available online right now.

Speaker #4: I would also like to take this opportunity to invite everyone to visit our upgraded SAL investor relations website at ir.sal.sa. The website provides easy access to our financial reports, presentations, announcements, calendar events, and many other resources.

Speaker #4: We also encourage everyone to sign up for our subscription and investor alerts on the website to be able to receive any future announcements and company updates directly.

Abdel Rahab: We also encourage everyone to sign for our subscription and investor alerts on the website to be able to receive any future announcements, company updates directly. Turning onto today's agenda, our CEO, Omar Hariri, will begin by taking you through the operating environment, our strategic progress, and the key drivers behind our performance and results for the period. This will be followed by our CFO, Haydar, who will take us through the group's financial results, divisional performance, and capital deployment in more detail. Following the presentation, as mentioned by Ali, our team will be pleased to answer your questions. With that, I will now hand over to our CEO to start the presentation.

Abdul Wahab: We also encourage everyone to sign for our subscription and investor alerts on the website to be able to receive any future announcements, company updates directly. Turning onto today's agenda, our CEO, Omar Hariri, will begin by taking you through the operating environment, our strategic progress, and the key drivers behind our performance and results for the period. This will be followed by our CFO, Haydar, who will take us through the group's financial results, divisional performance, and capital deployment in more detail. Following the presentation, as mentioned by Ali, our team will be pleased to answer your questions. With that, I will now hand over to our CEO to start the presentation.

Speaker #4: Turning to today's agenda, our CEO, Omar Hariri, will begin by taking you through the operating environment, our strategic progress, and the key drivers behind our performance and results for the period.

Speaker #4: This will then be followed by our CFO, Haider, who will take us through the group's financial results, divisional performance, and capital deployment in more detail.

Speaker #4: Following the presentation, as mentioned by Ali, our team will be pleased to answer your questions. With that, I will now hand over to our CEO to start the presentation.

Speaker #5: Thanks, Abdul Wahab. Good afternoon, and thank you for joining us today. Before we begin discussing the earnings, I would first like to express how proud I am of SAL's team and what they have achieved over the past few months.

Omar Hariri: Thank you, Abdel Rahab. Everyone, and good afternoon. Thank you for joining us today. Before we begin discussing the earnings, I'd like first to express how proud I am with SAL's team and what they achieved over the past few months. Despite operating in an environment characterized by geopolitical uncertainty, regional disruption, and evolving supply chain dynamics, we delivered the highest quarterly revenue levels in the company's history. These results are a testament to the dedication, resilience, and commitment of our team across every part of the business. I'd like to sincerely thank all of them for their outstanding efforts and execution throughout what has been a challenging operating environment. What is particularly encouraging is that the performance was not driven by temporary factors alone.

Speaker #5: Despite operating in an environment characterized by geopolitical uncertainty, regional disruption, and evolving supply chain dynamics, we delivered the highest quarterly revenue levels in the company's history.

Speaker #5: These results are a testament to the dedication, resilience, and commitment of our team across every part of the business. I'd like to sincerely thank all of them for their outstanding efforts and execution throughout what has been a challenging operating environment.

Speaker #5: What is particularly encouraging is that the performance was not driven by temporary factors alone. It reflects the strengths of our business model and the quality of our customer relationships, disciplined commercial execution, and the continued delivery of our long-term strategy.

Omar Hariri: It reflects the strengths of our business model and the quality of our customers' relationship, disciplined commercial execution, and the continued delivery of our long-term strategy. Let me briefly begin by reminding everyone how SAL is positioned today. Cargo handling remains the foundation of our business and continues our largest earning contributor. With the successful completion of Aviapartner Liège's acquisition, SAL has now expanded internationally for the first time, bringing our network to 20 stations across Saudi Arabia and Belgium. Our logistics division extends our capabilities beyond cargo handling through integrated freight forwarding, contract logistics, and specialized logistics solutions across a growing range of customer sectors. Meanwhile, SAL Logistics Zones represents our next long-term growth platform, creating the needed significant warehousing capacity and strengthening multimodal connectivity across air, sea, and land transportation.

Speaker #5: Let me briefly begin by reminding everyone how SAL is positioned today. Cargo handling remains the foundation of our business and continues to be our largest earning contributor.

Speaker #5: And with the successful completion of the AV Partner Liage acquisition, SAL has now expanded internationally for the first time, bringing our network to 20 stations across Saudi Arabia and Belgium.

Speaker #5: Our logistics division extends our capabilities beyond cargo handling through integrated freight forwarding, contract logistics, and specialized logistics solutions across a growing range of customer sectors.

Speaker #5: Meanwhile, SAL zones represent our next long-term growth platform, creating the needed significant warehousing capacity and strengthening multimodal connectivity across air, sea, and land transportation.

Speaker #5: Together, these three divisions allow us to strengthen our market-leading position in cargo ground handling, while building new sources of long-term growth. Our strategy remains focused on three priorities: expanding our offering through organic growth, strategic partnerships, and selective acquisitions; improving efficiency and service quality through operational excellence; and investing in digitization, artificial intelligence, and automation to build smarter and more scalable logistics platforms for the future.

Omar Hariri: Together, these three divisions allow us to strengthen our market-leading position in cargo ground handling while building new sources of long-term growth. Our strategy remains focused on three priorities: expanding our offering through organic growth, strategic partnerships, and selective acquisitions, improving efficiency and service quality through operational excellence, and investing in digitization, artificial intelligence, and automation to build smarter and more scalable logistics platforms for the future. Next slide, please. Turning to the operating environment, Q2 saw unexpected recovery following the temporary disruption experienced earlier this year. Air cargo activity improved as airline operation gradually normalized, capacity returned to the market, and the regional supply chains adjusted. At the same time, resilience was important for our continued demand to support cargo volumes across the kingdom. While operating conditions improved during the quarter, the broader market environment remained highly dynamic.

Speaker #5: Next slide, please. Turning to the operating environment, Q2 saw an expected recovery following the temporary disruption experienced earlier this year. Air cargo activity improved as airline operations gradually normalized, capacity returned to the market, and the region's supply chains adjusted. At the same time, resilience was important for our continued demand to support cargo volumes across the Kingdom.

Speaker #5: While operating conditions improved during the quarter, the broader market environment remained highly dynamic. Geopolitical developments across the region continued to influence global supply chains, shipping routes, airline schedules, and customer requirements.

Omar Hariri: Geopolitical development across the region continued to influence global supply chains, shipping routes, airline schedules, and customer requirements. More recently, we have seen renewed uncertainty surrounding the key maritime corridors, including the Strait of Hormuz and Bab el-Mandeb, together with incidents affecting shipping activities in the Red Sea. Although these developments have primarily affected maritime transportation, they naturally influence the wider logistics ecosystem through changes in routing, transit times, insurance cost, freight rates, and customer planning. In periods like these, operational agility becomes increasingly important. At SAL, we continuously monitor developments across the region, maintain close communication with our key airlines partners and customers, and adjust our operational plan whenever necessary to ensure uninterrupted service. Our nationwide network, integrated operation model, and experienced operation team allow us to respond quickly to changes in cargo flows and redeploy our resources efficiently and maintain high service levels in a rapidly changing environment.

Speaker #5: More recently, we have seen renewed uncertainty surrounding key maritime corridors, including the Strait of Hormuz and Bab al-Mandeb, together with incidents affecting shipping activities in the Red Sea.

Speaker #5: Although these developments have primarily affected maritime transportation, they naturally influence the wider logistics ecosystem through changes in routing, transit times, insurance costs, freight rates, and customer planning.

Speaker #5: In periods like these, operational agility becomes increasingly important. At SAL, we continuously monitor developments across the region, maintain close communication with our key airline partners and customers, and adjust our operational plan whenever necessary to ensure uninterrupted service.

Speaker #5: Our nationwide network, integrated operations model, and experienced operations team allow us to respond quickly to changes in cargo flows, redeploy our resources efficiently, and maintain high service levels even in rapidly changing environments.

Speaker #5: This operational flexibility has become one of SAL's key competitive strengths. Importantly, despite the external uncertainty, our direct operational impact during the quarter remained limited and temporary.

Omar Hariri: This operational flexibility has become one of SAL's key competitive strengths. Importantly, despite the external uncertainty, our direct operation impact during the quarter remained limited and temporary. Our priorities throughout the period remained unchanged: maintaining service continuity, protecting revenue quality, supporting our customer response quickly whenever market conditions changed. Alhamdulillah, our team delivered exceptionally well throughout the quarter. At the same time, we continued executing against our long-term growth strategy. During the quarter and shortly after its end, we secured new airlines and logistics customers, continued progressing our SAL Zones development, we advanced several strategic infrastructure projects, and we completed the acquisition of Aviapartner Liège, marking SAL's first international expansion. Looking ahead, while uncertainty remains elevated, periods like this also reinforce the importance of reliable logistics partners.

Speaker #5: Our priorities throughout the period remained unchanged: maintaining service continuity, protecting revenue, ensuring quality, and supporting our customers by responding quickly whenever market conditions changed. Alhamdulillah, our team delivered exceptionally well throughout the quarter.

Speaker #5: At the same time, we continued executing against our long-term growth strategy. During the quarter, and shortly after its end, we secured new airline and logistics customers, continued progressing our SAL zones development, advanced several strategic infrastructure projects, and completed the acquisition of AV Partner Liège, marking SAL's first international expansion.

Speaker #5: Looking ahead, while uncertainty remains elevated, periods like this also reinforce the importance of reliable logistics partners. Customers increasingly value resilience, consistency, and execution, and we believe SAL is well positioned to continue supporting them regardless of how market conditions evolve.

Omar Hariri: Customers increasingly value resilience, consistency, and execution, and we believe SAL is well-positioned to continue supporting them regardless of what the market conditions evolve. La hawla. We will therefore remain focused on executing our strategy while closely monitoring how geopolitical developments may influence cargo flows, airline capacity, customer behavior, and broader supply chain dynamics. Against this backdrop, I'm pleased to say that SAL once again demonstrated the resilience of the business model and the strength of its execution capabilities. The Q2 represents another important milestone for our company. Again, we delivered record quarterly revenue, record gross profit, and record earnings, while at the same time continuing to invest significantly in our future growth platforms. Perhaps most importantly, revenue increased by 30% year-on-year, significantly ahead of cargo volumes growth of 9%.

Speaker #5: Thank you, Lassamahallah. We will therefore remain focused on executing our strategy while closely monitoring how geopolitical developments may influence cargo flows, airline capacity, customer behavior, and border supply chain dynamics.

Speaker #5: Against this backdrop, I'm pleased to say that SAL once again demonstrated the resilience of the business model and the strength of its execution capabilities.

Speaker #5: The second quarter represents another important milestone for our company. Again, we delivered record quarterly revenue, record gross profit, and record earnings, while at the same time continuing to invest significantly in our future growth platforms.

Speaker #5: Perhaps most importantly, revenue increased by 30% year on year, significantly ahead of cargo volumes growth of 9%. This clearly demonstrates the continued improvement in the quality of our revenues, supported by stronger import activities, disciplined pricing, a more favorable cargo mix, and continued commercial execution.

Omar Hariri: This clearly demonstrates the continued improvement in the quality of our revenues, supported by stronger import activities, disciplined pricing, and more favorable cargo mix, and continued commercial execution. Just as importantly, we maintain strong profitability despite accelerating investments across the business. Our margins remained resilient, reflecting the strength of our operations model, disciplined commercial management, and our continued focus on operational efficiency. Cargo ground handling once again remained operational and the financial foundation of the company, while our logistics division continued building momentum, delivering strong growth and making meaningful progress towards sustainable profitability. This performance was also supported by positive adjusted free cash flow and strong net cash position, providing us with the financial flexibility to continue investing confidently across our strategic priorities.

Speaker #5: Just as importantly, we maintained strong profitability despite accelerating investments across the business. Our margin remained resilient, reflecting the strength of our operating model, disciplined commercial management, and our continued focus on operational efficiency.

Speaker #5: Cargo ground handling once again remained the operational and financial foundation of the company, while our logistics division continued building momentum, delivering strong growth and making meaningful progress toward sustainable profitability.

Speaker #5: This performance was also supported by positive, adjusted-free cash flow and a strong net cash position, providing us with the financial flexibility to continue investing confidently across our strategic priorities.

Speaker #5: One of those priorities is SAL zones. While phase one continued to progress well and remained on track as planned, it is creating the foundation for our next long-term growth platform.

Omar Hariri: One of those priorities is SAL Zones, where phase 1 continued to progress well and remaining on track as planned, creating the foundation of our next long-term growth platform. Overall, this quarter demonstrated that SAL is not only growing, but it's also improving the quality of its earnings while simultaneously investing in the capabilities that support sustainable long-term value creation for our shareholders. With that, let me hand over to Haydar, who will take you through our financial performance in more details.

Speaker #5: Overall, this quarter demonstrated that SAL is not only growing but is also improving the quality of its earnings while simultaneously investing in the capabilities that support sustainable, long-term value creation for our shareholders.

Speaker #5: With that, let me hand over to Haider, who will take you through our financial performance in more detail. Thank you, Omar. Thank you. Good afternoon, everyone, and welcome to our earnings call covering half-year and Q2 results.

Haydar Yuksel: Thank you, Omar. Thank you. Good afternoon, everyone, and welcome to our earnings call covering H1 and Q2 results. I will begin by taking you through our financial performance for the Q2, then to key operational drivers behind those results for each of the business lines. As Omar highlighted, this was another record quarter for SAL, reflecting both strong commercial execution and higher earnings quality. Let me start with the group's headlines performance. We are pleased to report another good quarter with strong financial performance across SAL's business divisions. We delivered the highest quarterly revenue, supported by broad-based growth across both Ground Handling and Logistics divisions. Revenue reached SAR 512 million, representing an increase of 30% year-on-year. EBIT increased by 24% to SAR 213 million, while net profit increased 18% to reach SAR 191 million.

Haydar Ucar: Thank you, Omar. Thank you. Good afternoon, everyone, and welcome to our earnings call covering H1 and Q2 results. I will begin by taking you through our financial performance for the Q2, then to key operational drivers behind those results for each of the business lines. As Omar highlighted, this was another record quarter for SAL, reflecting both strong commercial execution and higher earnings quality. Let me start with the group's headlines performance. We are pleased to report another good quarter with strong financial performance across SAL's business divisions. We delivered the highest quarterly revenue, supported by broad-based growth across both Ground Handling and Logistics divisions. Revenue reached SAR 512 million, representing an increase of 30% year-on-year. EBIT increased by 24% to SAR 213 million, while net profit increased 18% to reach SAR 191 million.

Speaker #5: I'll begin by taking you through our financial performance for the second quarter, and then move to the key operational drivers behind those results for each of the business lines.

Speaker #5: As Omar highlighted, this was another record quarter for SAL, reflecting both strong commercial execution and high earnings quality. Let me start with the group's headline performance.

Speaker #5: Yeah, so we are pleased to report another good quarter with strong financial performance across SAL's business divisions. We delivered the highest quarterly revenue, supported by broad-based growth across both the ground handling and logistics divisions.

Speaker #5: Revenue reached $512 million, representing an increase of 30% year on year. EBIT increased by 24% to $213 million, while net profit increased 18% to reach $191 million.

Speaker #5: Looking at the first half as a whole, revenue increased by 23% to $958 million, while EBIT reached $384 million or 14%. Net profit increased 10% to $348 million in this period.

Haydar Yuksel: Looking at the H1 as a whole, revenue increased by 23% to SAR 958 million, while EBIT reached SAR 384 million, up 14%. Net profit increased 10% to SAR 348 million in this period. The quarter also represented a clear step up from the prior quarter. Revenue increased 15%, while EBIT growth 25% and net profit increased 22%. Overall, these results reflect improving market conditions and the disciplined execution of our commercial and operational strategies. Looking more closely at our profitability, most notably was the improvement in revenue quality. As Omar mentioned earlier, Ground Handling benefited from resilient import demand and more favorable cargo mix, and a higher contribution from value-added services. At the same time, our Logistics business continued to deliver strong double-digit revenue growth, supported by expanding activity across project logistics and trucking services.

Haydar Ucar: Looking at the H1 as a whole, revenue increased by 23% to SAR 958 million, while EBIT reached SAR 384 million, up 14%. Net profit increased 10% to SAR 348 million in this period. The quarter also represented a clear step up from the prior quarter. Revenue increased 15%, while EBIT growth 25% and net profit increased 22%. Overall, these results reflect improving market conditions and the disciplined execution of our commercial and operational strategies. Looking more closely at our profitability, most notably was the improvement in revenue quality. As Omar mentioned earlier, Ground Handling benefited from resilient import demand and more favorable cargo mix, and a higher contribution from value-added services. At the same time, our Logistics business continued to deliver strong double-digit revenue growth, supported by expanding activity across project logistics and trucking services.

Speaker #5: The quarter also represented a clear step up from the prior quarter. Revenue increased 15%, while EBIT rose 25%, and net profit increased 22%. Overall, these results reflect improving market conditions and the disciplined execution of our commercial and operational strategies.

Speaker #5: Looking more closely at our profitability, most notable was the improvement in revenue quality. As Omar mentioned earlier, ground handling benefited from resilient import demand, a more favorable cargo mix, and a higher contribution from value-added services.

Speaker #5: At the same time, our logistics business continued to deliver strong, double-digit revenue growth, supported by expanding activity across contract logistics and trucking services. In addition, we benefited from lower expected credit loss provisions and lower transaction-related costs compared with previous periods.

Haydar Yuksel: In addition, we benefited from the lower expected credit loss provisions and lower transaction-related costs compared with previous periods. These positive factors were partially offset by one-off financing costs and advisory costs mainly related to the acquisition, and a combined total of approximately SAR 13 million one-off impact in the period. Despite one-offs, earnings per share increased to SAR 2.39 compared with SAR 2.03 in the same quarter last year, reflecting continued focus on delivering attractive returns for our shareholders. Turning to margins. At the group level, EBIT margin reached 41.6% during the Q2. This represents an improvement of 3.3 percentage points compared with Q1, reflecting recovery in airline operations and cargo flows following the contemporary disruptions experienced earlier this year. Compared with the same quarter last year, margins were modestly lower by 2.2 percentage points.

Haydar Ucar: In addition, we benefited from the lower expected credit loss provisions and lower transaction-related costs compared with previous periods. These positive factors were partially offset by one-off financing costs and advisory costs mainly related to the acquisition, and a combined total of approximately SAR 13 million one-off impact in the period. Despite one-offs, earnings per share increased to SAR 2.39 compared with SAR 2.03 in the same quarter last year, reflecting continued focus on delivering attractive returns for our shareholders. Turning to margins. At the group level, EBIT margin reached 41.6% during the Q2. This represents an improvement of 3.3 percentage points compared with Q1, reflecting recovery in airline operations and cargo flows following the contemporary disruptions experienced earlier this year. Compared with the same quarter last year, margins were modestly lower by 2.2 percentage points.

Speaker #5: These positive factors were partially offset by one-off financing costs and advisory costs, mainly related to the acquisition, with a combined total of approximately $13,000 one-off impact in the period.

Speaker #5: Despite one-offs, earnings per share increased to $2.39, compared with $2.03 in the same quarter last year, reflecting continued focus on delivering attractive returns for our shareholders.

Speaker #5: Turning to margins, at the group level, EBIT margin reached 41.6% during the second quarter. This represented an improvement of 3.3 percentage points compared with Q1, reflecting recovery in airline operations and cargo flows following the contemporary disruptions experienced earlier this year.

Speaker #5: Compared with the same quarter last year, margins were modestly lower by 2.2 percentage points. This primarily reflects changing business dynamics, impacts of seasonality, volume disruptions from the March supply shock, and a growing logistics division with a separate margin profile.

Haydar Yuksel: This primarily reflects changing business dynamics, impacts of seasonality, volume disruptions from March, supply shock, and a growing Logistics division with a separate margin profile. Ground Handling continued to deliver exceptionally strong profitability, achieving an EBIT margin of 49.8% in the period, demonstrating extreme resilience and efficiency in the core business. Meanwhile, in our Logistics division, we continued making encouraging progress with its EBIT margin improving significantly to -2.5% compared with -21.8% in the Q1. As the Logistics business continues to scale, increase utilization, and generate greater operating leverage, we remain confident in its path towards sustainable profitability. Next slide, please. The quality of our performance is equally reflected in our cash conversion and working capital management. Net working capital stood at SAR 194 million, representing 8.5% of annualized revenue, compared with approximately 15% during the same period last year.

Haydar Ucar: This primarily reflects changing business dynamics, impacts of seasonality, volume disruptions from March, supply shock, and a growing Logistics division with a separate margin profile. Ground Handling continued to deliver exceptionally strong profitability, achieving an EBIT margin of 49.8% in the period, demonstrating extreme resilience and efficiency in the core business. Meanwhile, in our Logistics division, we continued making encouraging progress with its EBIT margin improving significantly to -2.5% compared with -21.8% in the Q1. As the Logistics business continues to scale, increase utilization, and generate greater operating leverage, we remain confident in its path towards sustainable profitability. Next slide, please. The quality of our performance is equally reflected in our cash conversion and working capital management. Net working capital stood at SAR 194 million, representing 8.5% of annualized revenue, compared with approximately 15% during the same period last year.

Speaker #5: Ground handling continued to deliver exceptionally strong profitability, achieving an EBIT margin of 49.8% in the period, demonstrating extreme resilience and efficiency in the core business.

Speaker #5: Meanwhile, in our logistics division, we continued making encouraging progress, with its EBIT margin improving significantly to negative 2.5%, compared with negative 21.8% in the first quarter.

Speaker #5: As the logistics business continues to scale, increase utilization, and generate greater operating leverage, we remain confident in its path towards sustainable profitability. Next slide, please.

Speaker #5: The quality of our performance is equally reflected in our cash conversion and working capital management. Net working capital stood at $194 million, representing 8.5% of annualized revenue, compared with approximately 15% during the same period last year.

Speaker #5: All the working capital increased modestly compared with Q1. This was largely driven by the high level of business activity during the quarter, mainly sales-driven.

Haydar Yuksel: Although working capital increased modestly compared with Q1, this was largely driven by the high level of business activity during the quarter, mainly sales driven. Importantly, the overall ratio remains stable, reflecting continued discipline in managing receivables, payables management, and operating cash flows. This disciplined approach continues to support healthy cash generation while providing sufficient flexibility to support our ongoing investment program. Turning to cash and balance sheet strengths, SAL ended the H1 with approximately SAR 1.3 billion in cash and cash equivalents. Despite significantly increasing our investment activity, adjusted free cash flow remained SAR +167 million. Capital expenditures increased to SAR 144 million, reflecting continued investments across our three divisions, and probably the most expense that we have seen on CapEx so far in SAL's history. Earlier this year, we also successfully completed our SAR 1 billion Sukuk program, further strengthening our long-term funding plans.

Haydar Ucar: Although working capital increased modestly compared with Q1, this was largely driven by the high level of business activity during the quarter, mainly sales driven. Importantly, the overall ratio remains stable, reflecting continued discipline in managing receivables, payables management, and operating cash flows. This disciplined approach continues to support healthy cash generation while providing sufficient flexibility to support our ongoing investment program. Turning to cash and balance sheet strengths, SAL ended the H1 with approximately SAR 1.3 billion in cash and cash equivalents. Despite significantly increasing our investment activity, adjusted free cash flow remained SAR +167 million. Capital expenditures increased to SAR 144 million, reflecting continued investments across our three divisions, and probably the most expense that we have seen on CapEx so far in SAL's history. Earlier this year, we also successfully completed our SAR 1 billion Sukuk program, further strengthening our long-term funding plans.

Speaker #5: Importantly, the overall ratio remained stable, reflecting continued discipline in managing receivables, payables management, and operating cash flows. This disciplined approach continues to support healthy cash generation, while providing sufficient flexibility to support our ongoing investment program.

Speaker #5: Turning to cash and balance sheet strengths, SAL ended the first half with approximately $1.3 billion in cash and cash equivalents. Despite significantly increasing our investment activity, adjusted free cash flow remained positive at $167 million.

Speaker #5: Capital expenditures increased to $144 million, reflecting continued investments across our three divisions, and probably the most expenses that we have seen on CapEx so far in SAL's history.

Speaker #5: Earlier this year, we also successfully completed our $1 billion food program, further strengthening our long-term funding plans. Overall, our balance sheet strength provides us with the financial capacity to continue investing in future growth opportunities, while maintaining prudent financial discipline and supporting our long-standing commitment to shareholder returns.

Haydar Yuksel: Overall, our balance sheet strength provides us the financial capacity to continue investing in future growth opportunities while maintaining prudent financial discipline and supporting our long-standing commitment to shareholder returns. Next slide, please. Going into the Ground Handling division. Next slide, please. Ground Handling delivered another outstanding quarter, reinforcing its position as the market leader in Saudi Arabia and the group's core earnings engine. Revenue increased 29% year-on-year to SAR 431 million, while EBIT increased 32% to SAR 218 million. At the same time, the division delivered an EBIT margin of 49.8%, representing another exceptionally strong level of profitability. Results underscore resilience of the business model that we have in place, the strength of our commercial position, and the effectiveness of our operations. Ground Handling continues to provide financial substance that supports SAL's broader growth strategy. The strong performance of the division was primarily driven by three key factors.

Haydar Ucar: Overall, our balance sheet strength provides us the financial capacity to continue investing in future growth opportunities while maintaining prudent financial discipline and supporting our long-standing commitment to shareholder returns. Next slide, please. Going into the Ground Handling division. Next slide, please. Ground Handling delivered another outstanding quarter, reinforcing its position as the market leader in Saudi Arabia and the group's core earnings engine. Revenue increased 29% year-on-year to SAR 431 million, while EBIT increased 32% to SAR 218 million. At the same time, the division delivered an EBIT margin of 49.8%, representing another exceptionally strong level of profitability. Results underscore resilience of the business model that we have in place, the strength of our commercial position, and the effectiveness of our operations. Ground Handling continues to provide financial substance that supports SAL's broader growth strategy. The strong performance of the division was primarily driven by three key factors.

Speaker #5: Next slide, please. So, going into the Ground Handling division—next slide, please. Ground Handling delivered another outstanding quarter, reinforcing its position as the market leader in Saudi Arabia and the group's core earnings engine.

Speaker #5: Revenue increased 29% year-on-year to $431 million, while EBIT increased 32% to $218 million. At the same time, the division delivered an EBIT margin of 49.8%, representing another exceptionally strong level of profitability.

Speaker #5: Results underscore the resilience of the business model that we have in place, the strength of our commercial position, and the effectiveness of our operations. Ground handling continues to provide financial contribution that supports SAL's broader growth strategy.

Speaker #5: The strong performance of the division was primarily driven by three key factors: first, strong commercial leadership; second, improving revenue quality; and third, a more favorable cargo mix.

Haydar Yuksel: First, strong commercial leadership, improving revenue quality, a more favorable cargo mix, and a greater contribution from specialist and value-added services. Second, operational resilience enabled us to respond quickly to changing cargo flows while maintaining consistently high service levels. Throughout the quarter, our teams remained in close communication with customers, continually adjusted handling plans, and efficiently redeployed people and equipment across our network whenever required. Our nationwide operating footprint, together with our road feeder services network, also enabled us to maintain cargo movements between key airports while ensuring uninterrupted customer service. These capabilities are becoming increasingly valuable as customers seek logistics partners that can provide reliability, flexibility, and operational consistency during periods of market uncertainty. Third, we continue to strengthen relationship with international airline customers while expanding the range of services we provide across our network.

Haydar Ucar: First, strong commercial leadership, improving revenue quality, a more favorable cargo mix, and a greater contribution from specialist and value-added services. Second, operational resilience enabled us to respond quickly to changing cargo flows while maintaining consistently high service levels. Throughout the quarter, our teams remained in close communication with customers, continually adjusted handling plans, and efficiently redeployed people and equipment across our network whenever required. Our nationwide operating footprint, together with our road feeder services network, also enabled us to maintain cargo movements between key airports while ensuring uninterrupted customer service. These capabilities are becoming increasingly valuable as customers seek logistics partners that can provide reliability, flexibility, and operational consistency during periods of market uncertainty. Third, we continue to strengthen relationship with international airline customers while expanding the range of services we provide across our network.

Speaker #5: And a greater contribution from specialists and value-added services. Second, operational resilience enabled us to respond quickly to changing cargo flows while maintaining consistently high service levels.

Speaker #5: Throughout the quarter, our teams remained in close communication with customers, continually adjusted handling plans, and efficiently redeployed people and equipment across our network whenever required.

Speaker #5: Our nationwide operating footprint, together with our world feeder services network, also enabled us to maintain cargo movements between key airports while ensuring uninterrupted customer service.

Speaker #5: These capabilities are becoming increasingly valuable as customers seek logistics partners that can provide reliability, flexibility, and operational consistency during periods of market uncertainty. Thirdly, we continue to strengthen relationships with international airline customers while expanding the range of services we provide across our network, to note a few.

Haydar Yuksel: To note a few, we signed a number of new agreements such as Singapore Airlines, SF Airlines, Liferiver, and Centurion Air Cargo. At the same time, our CargoGate continued to improve both customer experience and operational efficiency through real-time cargo tracking, truck appointment scheduling, digital delivery notification, and electronic payment capabilities. Next slide, please. In terms of the volumes handling, we saw a solid increase in the period. During Q2, we handled approximately 239 million kgs of cargo, representing an increase of 9% compared with the same period last year and almost flat with Q1. Imports were the primary driver of this growth, increasing from 127 million kgs to 153 million kgs, reflecting continued resilience in the Saudi import demand. Export volumes remained relatively stable while transit volumes slightly declined compared with last year's same Q.

Haydar Ucar: To note a few, we signed a number of new agreements such as Singapore Airlines, SF Airlines, Liferiver, and Centurion Air Cargo. At the same time, our CargoGate continued to improve both customer experience and operational efficiency through real-time cargo tracking, truck appointment scheduling, digital delivery notification, and electronic payment capabilities. Next slide, please. In terms of the volumes handling, we saw a solid increase in the period. During Q2, we handled approximately 239 million kgs of cargo, representing an increase of 9% compared with the same period last year and almost flat with Q1. Imports were the primary driver of this growth, increasing from 127 million kgs to 153 million kgs, reflecting continued resilience in the Saudi import demand. Export volumes remained relatively stable while transit volumes slightly declined compared with last year's same Q.

Speaker #5: We signed a number of new agreements such as Singapore Airlines, SF Airlines, Flight River, and Centrum Air. At the same time, our cargo official platform continued to improve both customer experience and operational efficiency through real-time cargo tracking, truck appointment scheduling, digital delivery notifications, and electronic payment capabilities.

Speaker #5: Next slide, please. In terms of volumes and results, SAL increased in the period. During the second quarter, we handled approximately 239 million kgs of cargo, representing an increase of 9% compared with the same period last year, and almost flat with the first quarter.

Speaker #5: Imports were the primary driver of this growth, increasing from 127 million kgs to 153 million kgs, reflecting continued resilience in Saudi import demand.

Speaker #5: Export volumes remained probably stable, while transit volumes slightly declined compared with the same quarter last year. Importantly, the higher contribution from imports, together with a greater share of higher-value cargo, enabled revenue growth to significantly outpace volume growth.

Haydar Yuksel: Importantly, the higher contribution from imports, together with a greater share of higher-value cargo, enabled revenue growth to significantly outpace volume growth. In other words, we successfully converted recovering cargo activity into higher-quality revenue through a stronger cargo mix and a continued expansion of our value-added services. Looking ahead, the recovery experienced during Q2 provides a stronger platform for the remainder of the year. That said, market visibility remains somewhat limited given the evolving geopolitical environment, which we are monitoring closely. Performance during H2 will continue to depend on airline capacity, cargo flows, and the sustainability of the current strength in import demand. Next slide, please. Going into the Logistics division. We can start with the next slide, please.

Haydar Ucar: Importantly, the higher contribution from imports, together with a greater share of higher-value cargo, enabled revenue growth to significantly outpace volume growth. In other words, we successfully converted recovering cargo activity into higher-quality revenue through a stronger cargo mix and a continued expansion of our value-added services. Looking ahead, the recovery experienced during Q2 provides a stronger platform for the remainder of the year. That said, market visibility remains somewhat limited given the evolving geopolitical environment, which we are monitoring closely. Performance during H2 will continue to depend on airline capacity, cargo flows, and the sustainability of the current strength in import demand. Next slide, please. Going into the Logistics division. We can start with the next slide, please.

Speaker #5: In other words, we successfully converted recovering cargo activity into higher-quality revenue through a stronger cargo mix and a continued expansion of our value-added services.

Speaker #5: Looking ahead, the recovery experience during the second quarter provides a stronger platform for the remainder of the year. That said, market visibility remains somewhat limited, given the evolving geopolitical environment.

Speaker #5: Which we are monitoring closely. Performance during the second half will continue to depend on airline capacity, cargo flows, and the sustainability of the current strength in import demand.

Speaker #5: Next slide, please. Going into the logistics division—we can start with the next slide, please. Revenues increased 34% year on year to $74 million in our logistics division, showing growth across contract logistics operations, trucking operations, and the core freight forwarding activities of the business.

Haydar Yuksel: Revenues increased 34% year-on-year to SAR 74 million in our Logistics division, showing growth across contract logistics operations, trucking operations, and the core freight forwarding activities of the business. At the same time, the operating loss narrowed significantly to SAR 2 million, compared with SAR 13 million during Q1. For H1 of the year, revenue reached SAR 135 million, representing 16% growth compared with the same period last year. Although the division remains in a growth and investment phase, these results demonstrate encouraging progress towards achieving greater scale and sustainable profitability. We continue to view 2026 as an important transition year for the Logistics division. Over recent years, our primary focus has been on building on it, investing in its infrastructure, expanding capabilities, and strengthening our commercial organization. Today, those operational foundations are largely in place.

Haydar Ucar: Revenues increased 34% year-on-year to SAR 74 million in our Logistics division, showing growth across contract logistics operations, trucking operations, and the core freight forwarding activities of the business. At the same time, the operating loss narrowed significantly to SAR 2 million, compared with SAR 13 million during Q1. For H1 of the year, revenue reached SAR 135 million, representing 16% growth compared with the same period last year. Although the division remains in a growth and investment phase, these results demonstrate encouraging progress towards achieving greater scale and sustainable profitability. We continue to view 2026 as an important transition year for the Logistics division. Over recent years, our primary focus has been on building on it, investing in its infrastructure, expanding capabilities, and strengthening our commercial organization. Today, those operational foundations are largely in place.

Speaker #5: At the same time, the operating loss narrowed significantly to $2 million, compared with $13 million during the first quarter. For the first half of the year, revenue reached $135 million, representing 16% growth compared with the same period last year.

Speaker #5: Although the division remains in its growth and investment phase, these results demonstrate encouraging progress toward achieving greater scale and sustainable profitability. We continue to view 2026 as an important transition year for the logistics division.

Speaker #5: Over recent years, our primary focus has been on building on it, investing in its infrastructure, expanding capabilities, and strengthening our commercial organization. Today, those operational foundations are largely in place.

Speaker #5: Our focus is increasingly shifting towards converting our commercial pipeline into recurring revenues, while pushing for more warehouse utilization. During the second quarter, strong activity across contract logistics and trucking services supported another period of solid growth.

Haydar Yuksel: Our focus is increasingly shifting towards converting our commercial pipeline into recurring revenues while pushing for more warehouse utilization. During Q2, stronger activity across contract logistics and trucking services support another period of solid growth. Higher warehouse utilization in the contract logistics operations also enabled the additional revenue to translate into a meaningful improvement in profitability. During the quarter, we also secured several important customer wins, such as Netmark and SGS. While there's still a lot of work ahead, we are happy to see the growth plans of the division progress as per our execution plans. Next slide, please. This slide. Yes, exactly. Turning now into capital allocations. Our investment program continues to progress as planned, and we are fully aligned with our long-term growth strategy.

Haydar Ucar: Our focus is increasingly shifting towards converting our commercial pipeline into recurring revenues while pushing for more warehouse utilization. During Q2, stronger activity across contract logistics and trucking services support another period of solid growth. Higher warehouse utilization in the contract logistics operations also enabled the additional revenue to translate into a meaningful improvement in profitability. During the quarter, we also secured several important customer wins, such as Netmark and SGS. While there's still a lot of work ahead, we are happy to see the growth plans of the division progress as per our execution plans. Next slide, please. This slide. Yes, exactly. Turning now into capital allocations. Our investment program continues to progress as planned, and we are fully aligned with our long-term growth strategy.

Speaker #5: Higher warehouse utilization in the contract logistics operations also enabled the additional revenue to translate into a meaningful improvement in profitability. During the quarter, we also secured several important customer wins, such as MetLock and SGS.

Speaker #5: While there's still a lot of work ahead, we have to see the growth plans of the division progress as per our execution plans. Next slide, please.

Speaker #5: Yes, exactly. So, turning now to capital allocations, our investment program continues to progress as planned, and we are fully aligned with our long-term growth strategy.

Speaker #5: As shown on the slide, we expect to invest approximately $5 billion between 2026 and 2030 across ground handling, logistics, and SAL zones. A high percentage of this plan is scheduled to be deployed during the early years, reflecting the commercial commencement of several of our major strategic infrastructure projects.

Haydar Yuksel: As shown on the slide, we expect to invest approximately SAR 5 billion between 2026 and 2030 across ground handling, logistics, and SAL Zones. A high percentage of this plan is scheduled to be deployed during the early years, reflecting the commercial commencement of several of our major strategic infrastructure projects. Approximately SAR 900 million has been allocated already to expanding and modernizing our ground handling terminals and warehouse infrastructure across key airport hubs. These investments will increase capacity, improve efficiency, and further strengthen service quality. A further SAR 203 million will support the continued expansion of our logistics business through additional warehousing and logistics facilities in Riyadh, Jeddah, and Dammam. The largest component of the program remains the SAL Zone project, with SAR 4.1 billion plans to develop Park City Malham in the north of Riyadh, creating what we believe will become one of the kingdom's leading integrated logistics hubs.

Haydar Ucar: As shown on the slide, we expect to invest approximately SAR 5 billion between 2026 and 2030 across ground handling, logistics, and SAL Zones. A high percentage of this plan is scheduled to be deployed during the early years, reflecting the commercial commencement of several of our major strategic infrastructure projects. Approximately SAR 900 million has been allocated already to expanding and modernizing our ground handling terminals and warehouse infrastructure across key airport hubs. These investments will increase capacity, improve efficiency, and further strengthen service quality. A further SAR 203 million will support the continued expansion of our logistics business through additional warehousing and logistics facilities in Riyadh, Jeddah, and Dammam.

Speaker #5: Approximately $900 million has already been allocated to expanding and modernizing our ground handling terminals and warehouse infrastructure across key airport hubs. These investments will increase capacity, improve efficiency, and further strengthen service quality.

Speaker #5: A further $203 million will support the continued expansion of our logistics business through additional warehousing and logistics facilities in Al Jazeera and Amman.

Haydar Ucar: The largest component of the program remains the SAL Zone project, with SAR 4.1 billion plans to develop Park City Malham in the north of Riyadh, creating what we believe will become one of the kingdom's leading integrated logistics hubs.

Speaker #5: The largest component of the program remains for the SAL Zone project, with $4.1 billion planned to develop partner city Melham in the north of Riyadh, creating what we believe will become one of the Kingdom's leading integrated logistics hubs.

Speaker #5: During the first half of the year, capital expenditures increased, reflecting continued investment across ground handling capacity expansion, logistics infrastructure, digital platforms, fleet capabilities, the Jelle Zandport project, and the early development of the SAL zones.

Haydar Yuksel: During the H1, capital expenditures increased, reflecting continued investment across ground handling capacity expansions, logistics infrastructure, digital platforms, fleet capabilities, the Jeddah Airport project, and the early development of the SAL Zones. Importantly, as of the end of June, approximately SAR 845 million, representing more than 52% of our planned 2026 capital program, has already been committed through signed contracts and awarded projects. This demonstrates a significant portion of our investment program has already progressed beyond planning into contractual execution, providing good visibility over the delivery of our long-term growth initiatives. Going forward, capital deployment will continue to be phased responsibly in line with construction project, operational readiness, and commercial milestone goals. With that, let me hand the presentation back to our CEO, Omar Hariri.

Haydar Ucar: During the H1, capital expenditures increased, reflecting continued investment across ground handling capacity expansions, logistics infrastructure, digital platforms, fleet capabilities, the Jeddah Airport project, and the early development of the SAL Zones. Importantly, as of the end of June, approximately SAR 845 million, representing more than 52% of our planned 2026 capital program, has already been committed through signed contracts and awarded projects. This demonstrates a significant portion of our investment program has already progressed beyond planning into contractual execution, providing good visibility over the delivery of our long-term growth initiatives. Going forward, capital deployment will continue to be phased responsibly in line with construction project, operational readiness, and commercial milestone goals. With that, let me hand the presentation back to our CEO, Omar Hariri.

Speaker #5: Importantly, as of the end of June, approximately $845 million—representing more than 52% of our planned 2026 capital program—has already been committed through signed contracts and awarded projects.

Speaker #5: This demonstrates that a significant portion of our investment program has already progressed beyond planning and into contractual execution, providing good visibility over the delivery of our long-term growth initiatives.

Speaker #5: Going forward, capital deployment will continue to be paced responsibly, in line with construction projects, operational readiness, and commercial milestones. With that, let me hand the presentation back to our CEO, Omar Haddadi.

Speaker #2: Thank you, Haider. Before discussing our recent acquisition, let me briefly recap the progress we've made across each of SAL's strategic growth platforms. Within cargo ground handling, we continue strengthening relationships with international airline customers, expanded adoption of our CargoGate digital platform, and successfully completed the acquisition of AviaPartner Liège, establishing SAL's first international operating platform.

Omar Hariri: Thank you, Haydar. Before discussing our recent acquisition, let me briefly recap the progress we've made across each of SAL's strategic growth platforms. Within cargo ground handling, we continue strengthening relationships within international airlines customers, expanded adoption of our CargoGate digital platform, and successfully completed the acquisition of Aviapartner Liège, establishing SAL's first international operating platform. Within logistics, we continued improving warehouse utilization, increasing operating leverage, expanding our trucking and transportation, and contract logistics capabilities, and securing new strategic customers that support the division continued growth. Within SAL Zones, phase one has now moved into active construction while we continue developing our commercial pipeline and engaging with prospective customers. Taking together, these initiatives demonstrate that SAL is successfully executing multiple strategic priorities simultaneously while continuing to deliver strong financial performance.

Speaker #2: Within logistics, we continued improving warehouse utilization, increasing operating leverage, expanding our trucking and transportation and contract logistics capabilities, and securing new strategic customers that support the division's continued growth.

Speaker #2: Within SAL zones, phase one has now moved into active construction, while we continue developing our commercial pipeline and engaging with prospective customers. Taken together, these initiatives demonstrate that SAL is successfully executing multiple strategic priorities simultaneously, while continuing to deliver strong financial performance.

Speaker #2: More importantly, they demonstrate our commitment to diversifying our earnings base and building a broader logistics platform capable of delivering sustainable, long-term growth. This naturally brings me to our most significant strategic milestone and the most recent announcement: the acquisition completion of AviaPartner Liège.

Omar Hariri: More importantly, they demonstrate our commitment to diversify our earnings base and building a broader logistics platform capable of delivering sustainable long-term growth. This naturally brings me to our most significant strategic milestone and the most recent announcement, the acquisition completion of Aviapartner Liège. As many of you are aware, yesterday we have announced the successful completion of our acquisition of 100% of Aviapartner Liège. This transaction is much more than an acquisition. It represents an important strategic milestone in SAL's evolution from a leading domestic cargo handler into an international logistics platform. The acquisition will be held through the recent established SAL International Ground Handling company in Netherlands and will be consolidated into our financial statement beginning of Q3 2026, Inshallah. With this transaction, Liège becomes our 20th operating station and our first operations outside of Saudi Arabia.

Speaker #2: As many of you are aware, yesterday we announced the successful completion of our acquisition of 100% of AviaPartner Liège. This transaction is much more than an acquisition.

Speaker #2: It represents an important strategic milestone in SAL's evolution from a leading domestic cargo handler into an international logistics platform. The acquisition will be held through the recently established SAL International Ground Handling company in the Netherlands, and will be consolidated into our financial statements at the beginning of the third quarter of 2026, inshallah.

Speaker #2: With this transaction, Liège becomes our 20th operating station and our first operation outside of Saudi Arabia. Rather than building a European presence from the ground up, we have acquired an established cargo handling platform at one of the most important and leading hubs in Europe.

Omar Hariri: Rather than building an European presence from the ground up, we have acquired an established cargo handling platform at one of the most important leading hubs in Europe. The business includes modern warehouse and land facilities, specialized handling equipment, long-standing airline customer relationship, and an experienced operational workforce operating to well-established international safety and quality standards. During 2025, Aviapartner Liège handled approximately 200 million kilograms of cargo across nearly 1,700 freighter flights, representing approximately 16% of Liège Airport total cargo volume. Importantly, the existing infrastructure provides meaningful growth potential. Current warehouse utilization stand at approximately 56%, while total handling capacity is approximately 360 million kilograms, providing substantial headroom to increase throughput using existing asset base. We believe SAL can further enhance the business by combining our operational expertise, commercial capabilities, and long-standing airline relationship with Aviapartner's existing platform. Our immediate priorities following the completions are straightforward.

Speaker #2: The business includes modern warehouse and ramp facilities, specialized handling equipment, long-standing airline customer relationships, and an experienced operational workforce operating to well-established international safety and quality standards.

Speaker #2: During 2025, AviaPartner Liège handled approximately 200 million kilograms of cargo across nearly 1,700 freight flights, representing approximately 16% of Liège Airport's total cargo volume.

Speaker #2: Importantly, the existing infrastructure provides meaningful growth potential. Current warehouse utilization stands at approximately 56 percent, while total handling capacity is approximately 360 million kilograms, providing substantial headroom to increase throughput using the existing asset base.

Speaker #2: We believe SAL can further enhance the business by combining our operational expertise, commercial capabilities, and long-standing airline relationships with Aviapartner's existing platform. Our immediate priorities following the completion are straightforward.

Speaker #2: First, ensuring uninterrupted business continuity. Second, completing financial consolidation and governance integration. And third, progressively advancing operational alignment, commercial integration, and cross-selling opportunities across both businesses.

Omar Hariri: First, ensuring uninterrupted business continuity. Second, completing financial consolidation and governance integration. Third, progressively advancing operational alignment, commercial integration, and cross-selling opportunities across both businesses. Over the coming months, we will also finalize a detailed integration and synergy roadmap, and we will look forward to sharing further updates as the business develops. Now, why Liège? The strategic importance of Liège extends well beyond establishing a presence in Europe. The acquisition strengthens SAL's positioning across several international cargo corridors that are strategically important both for Saudi Arabia and for many of our airline customers. Liège handled approximately 1.3 million tons of cargo during 2025, making it Belgium's largest cargo airport and the fifth largest cargo airport in Europe. Its location within the Europe logistics golden triangle, together with its 24-hour operation and excellent multimodal connectivity, makes it one of the continent's most important cargo gateways.

Speaker #2: Over the coming months, we will also finalize a detailed integration and synergy roadmap, and we look forward to sharing further updates as the business develops.

Speaker #2: Now, why Liège? The strategic importance of Liège extends well beyond establishing a presence in Europe. The acquisition strengthens SAL's positioning across several international cargo corridors that are strategically important both for Saudi Arabia and for many of our airline customers.

Speaker #2: Liège handled approximately 1.3 million tons of cargo during 2025, making it Belgium's largest cargo airport and the fifth largest cargo airport in Europe. Its location within the European logistics golden triangle, together with its 24-hour operation and excellent multimodal connectivity, makes it one of the continent's most important cargo gateways.

Omar Hariri: The airport also benefits from a highly developed cargo ecosystem, serving more than 55 cargo airlines and over 65 logistics companies, while specializing in high-value sectors including pharmaceuticals, perishables, automotive, aerospace, and e-commerce. For SAL, we see three particular compelling strategic advantages. The first related to our main partner, Liège, is already one of Saudia Cargo most important European gateways. The second advantage is commercial, as increasingly airlines are procuring cargo handling services through regional or multi-country tenders rather than contracting airport by airport. Until now, SAL's proposition has centered on our leadership within Saudi Arabia. With Liège, we can now combine our 19 Saudi stations with an important European cargo gateway within a single commercial offering. This strengthens our competitiveness in international tenders, creates opportunities to deepen relationships with existing customers, and opens the door to new international airlines partnerships.

Speaker #2: The airport also benefits from a highly developed cargo ecosystem, serving more than 55 cargo airlines and over 65 logistics companies, while specializing in high-value sectors including pharmaceuticals, perishables, automotive, aerospace, and e-commerce.

Speaker #2: For SAL, we see three particularly compelling strategic advantages. The first, related to our main partner, is that Liège is already one of Saudi Cargo's most important European gateways.

Speaker #2: The second advantage is commercial, as increasingly airlines are procuring cargo handling services through regional or multi-country vendors rather than contracting airport by airport. Until now, SAL's proposition has centered on our leadership within Saudi Arabia. With Liège, we can now combine our 19 Saudi stations with an important European cargo gateway within a single commercial offering.

Speaker #2: This has strengthened our competitiveness in international tenders, created opportunities to deepen relationships with existing customers, and opened the door to new international airline partnerships. The third advantage is network connectivity, as Liège offers strong transatlantic cargo connections together with direct services into Saudi Arabia.

Omar Hariri: The third advantage is network connectivity, as Liège offers strong transatlantic cargo connections together with direct services into Saudi Arabia. This creates opportunity to facilitate cargo flows between North America, Europe, the Kingdom, and China, particularly for high-value items and time-sensitive cargo such as pharmaceutical, automotive products, aerospace components, and e-commerce shipments. Combined, these advantages significantly strengthen SAL's international positioning, expand our commercial reach, and create an excellent platform for future international growth. Now with the outlook. Looking ahead, we remain cautiously optimistic about H2 2026. The positive momentum we experienced during Q2 continued through June and into early July, supported by healthy customer demand and resilient import activity. At the same time, we recognize that the external environment has become increasingly dynamic.

Speaker #2: This creates opportunities to facilitate cargo flows between North America, Europe, the Kingdom, and China, particularly for high-value items and time-sensitive cargo such as pharmaceuticals, automotive products, aerospace components, and e-commerce shipments.

Speaker #2: Combined, these advantages have significantly strengthened SAL's international positioning, expanded our commercial reach, and created an excellent platform for future international growth. Now, with the outlook—looking ahead—we remain cautiously optimistic about the second half of 2026.

Speaker #2: The positive momentum we experienced during the second quarter continued through June and into early July, supported by healthy customer demand and resilient import activity.

Speaker #2: At the same time, we recognize that the external environment has become increasingly dynamic. Recent geopolitical developments across the region continue to create uncertainty around global trade routes, airline operations, and border supply chain activity.

Omar Hariri: Recent geopolitical developments across the region continue to create uncertainty around global trade routes, airline operation, and border supply chain activity. Given the evolving nature of the current situation, it is still too early to assess the full impact these developments may have on air cargo demand, airline capacity, or industry operating costs during the remainder of the year. However, based on what we see today, we remain comfortable in maintaining our full-year guidance, including our expectation of mid-single-digit revenue growth, while continuing to monitor developments closely. Our confidence is supported by the resilience we have already demonstrated during H1 of the year, together with the strength of our balance sheet, our diversified business model, and our disciplined execution. Regardless of the external environment, our priorities remain unchanged.

Speaker #2: Given the evolving nature of the current situation, it is still too early to assess with confidence the full impact these developments may have on air cargo demand, airline capacity, or industry operating costs during the remainder of the year.

Speaker #2: However, based on what we see today, we remain comfortable maintaining our full-year guidance, including our expectation of mid-single-digit revenue growth, while continuing to monitor developments closely.

Speaker #2: Our confidence is supported by the resilience we have already demonstrated during the first half of the year, together with the strength of our balance sheet, our diversified business model, and our disciplined execution.

Speaker #2: Regardless of the external environment, our priorities remain unchanged. We will continue focusing on what we can control, maintain safe and reliable operations, protect service continuity, support our customers, and respond quickly as market conditions evolve.

Omar Hariri: We will continue focusing on what we can control, maintain safe and reliable operations, protecting service continuity, supporting our customers, and responding quickly as market conditions evolved. Our nationwide operating footprint, flexible operating model, and trucking servicing network provide us with the agility required to adapt as cargo flows and customer requirements continue to change. Within cargo handling, we will continue investing in automation and innovation and operation excellence while strengthening long-term customer relationship. Within logistics, our focus remains on building and encouraging progress achieved during the Q2 by increasing capacity utilization, expanding technology adoption, and continuing our journey towards sustainable profitability. With SAL Zones, phase one remains on schedule with the development continued in line with construction progress and commercial leasing milestones. At the same time, we remain committed to maintaining our dividend payout guidelines while preserving the financial flexibility required to fund our long-term growth ambitions.

Speaker #2: Our nationwide operating footprint, flexible operating model, and tracking servicing network provide us with the agility required to adapt as cargo flows and customer requirements continue to change.

Speaker #2: Within cargo handling, we will continue investing in automation, innovation, and operational excellence, while strengthening long-term customer relationships. Within logistics, our focus remains on building upon the encouraging progress achieved during the second quarter by increasing capacity utilization, expanding technology adoption, and continuing our journey toward sustainable profitability.

Speaker #2: With SAL zones, phase one remains on schedule, with development continuing in line with construction progress and commercial leasing milestones. At the same time, we remain committed to maintaining our dividend payout guidelines while preserving the financial flexibility required to fund our long-term growth ambitions.

Speaker #2: As always, we will continue monitoring the market carefully, and we will update our investment community should our outlook materially change. Given the current level of uncertainty, we are maintaining our guidance until we have greater visibility into third quarter and full-year performance.

Omar Hariri: As always, we will continue monitoring the market carefully, we will update our investment community should our outlook materially change. Given the current level of uncertainty, we are maintaining our guidance until we have greater visibility in the Q3 and yearly performance. As for the closing remarks and key takeaways, we can conclude that we delivered the strongest quarterly revenue performance in our history as SAL, while we continue executing the strategic initiatives that will define the company's next phase of growth. These results demonstrate not only the resilience of our business model, but also the continued improvement in the quality of our earnings. Cargo ground handling, once again, provides a strong and dependable earnings foundation, while our logistics business continue making encouraging progress towards sustainable profitability. At the same time, we continue delivering against our long-term strategy. SAL Zones advanced into active development.

Speaker #2: As for the closing remarks and key takeaways, we can conclude that we delivered the strongest quarterly revenue performance in our history as SAL, while we continue executing the strategic initiatives that will define the company's next phase of growth.

Speaker #2: These results demonstrate not only the resilience of our business model, but also the continued improvement in the quality of our earnings. Cargo ground handling, once again, provides a strong and dependable earnings foundation, while our logistics business continues to make encouraging progress towards sustainable profitability.

Speaker #2: At the same time, we continue delivering against our long-term strategy. SAL zones advanced into active development, our investment program continued progressing as planned, and with the successful completion of our partner Liage acquisition, we have officially begun SAL's international expansion journey.

Omar Hariri: Our investment program continued progressing as planned, with the successful completion of Aviapartner Liège acquisition, we have officially begun SAL's international expansion journey. Our strong balance sheet, healthy cash generation, and disciplined capital allocation provide us with financial strength to continue investing future growth while maintaining flexibility and supporting attractive shareholder returns. Looking ahead, although the external environment remains dynamic, we believe SAL enters the H2 of the year from a position of strength. We have a resilient operating platform, a clear long-term strategy, committed employees, and multiple growth engines that positions us well to continue creating value for our customers, our shareholders, and the Kingdom broader logistics ecosystem.

Speaker #2: Our strong balance sheet, healthy cash generation, and disciplined capital allocation provide us with the financial strength to continue investing in future growth while maintaining flexibility in supporting attractive shareholder returns.

Speaker #2: Looking ahead, although the external environment remains dynamic, we believe SAL enters the second half of the year from a position of strength. We have a resilient operating platform, a clear long-term strategy, committed employees, and multiple growth engines that position us well to continue creating value for our customers, our shareholders, and the Kingdom’s broader logistics ecosystem.

Speaker #2: Before we conclude, I would once again like to thank our employees for their outstanding dedication and commitment, our partners for their continued trust, our shareholders for their confidence, and our Board of Directors for their ongoing guidance and support.

Omar Hariri: Before we conclude, I would once again like to thank our employees for their outstanding dedication and commitment, our partners for their continued trust, our shareholders for their confidence, and our board of directors for their ongoing guidance and support. Once again, thank you very much for joining us today. We'll turn back to our host, thank you to Alqaim Capital. We're ready now for your questions. Thank you very much.

Speaker #2: Once again, thank you very much for joining us today. I'll now return back to our hosts, and thank you to our Climb Capital. We're ready now. Thank you very much.

Speaker #1: Thank you, management team, for the presentation. And now we'll start the Q&A session. For all participants who wish to ask a question, you can type your question in the Q&A box or use the raise hand feature to speak directly to the management team.

Ali Adel: Thank you, management team, for the presentation. Now we start the Q&A session. For all participants who wish to ask a question, you can type your question on the Q&A box or use the raise hand feature to speak directly to the management team. Also, I would like to ask that all participants who wish to ask a question to first state their name and company, and also to limit their questions to two to give a chance for all participants wishing to ask any questions. We'll take our first question from the line of Nada Abdel Malik. Your line is now open. Please unmute yourself and proceed with your question.

Speaker #1: Also, I would like to ask the old participants who wish to ask a question to first state their name and company, and also to limit their questions to two, to give a chance for all participants wishing to ask any questions.

Speaker #1: So we'll take our first question from the line of Nada Abdul Malik. Your line is now open. Please unmute yourself and proceed with your question.

Speaker #3: Hello, Am I audible?

Nada Abdel Malik: Hello, am I audible?

Speaker #1: Yes, we can hear you, Nada.

Ali Adel: Yes, we can hear you, Nada.

Speaker #3: Yes, thank you, Alif, and congratulations to management on such very strong results. This is Nada from JIB Capital. I have only one question regarding the cargo segment, especially when it comes to the volume growth, which is 9%, and, along with it, the blended price has increased by 18%.

Nada Abdel Malik: Yes. Thank you, Alawi, congrats, management, on such very strong results. This is Nada from GIB Capital. I have only one question regarding the cargo segment, especially when it comes to the volume growth, which is 9%, along with it, the blended price has increased by 18%. To be honest, to me, this is very, very strong volume and pricing increase, to be just explained by the mix, unless the mix has changed significantly, to be honest. My question, is there in Q2 was any one-off delivery related to pharma segment, for example, so we will not see the same mix in H2 of this year, or this change in the mix will be sticky for the rest of the year, so we will still have this very strong growth and the blended price?

Speaker #3: To be honest, to me, this is very, very strong volume, and the pricing increase. And to be just explained by the max—unless the max has changed significantly, to be honest.

Speaker #3: So my question is: In the second quarter, was there any one-off delivery related to the pharma segment, for example, so we will not see the same mix in the second half of this year? Or will this change in the mix be sticky for the rest of the year, so we will still have this very strong growth in the blended price?

Speaker #3: And how should we think of it, honestly, going forward?

Nada Abdel Malik: How should we think of it, honestly, going forward?

Omar Hariri: Thank you very much. Let me explain about the cargo mix. Our volume growth, 9%, is within line of our forecast. We haven't seen a significant increase in volumes other than the normal business. Also, we haven't seen a big impact, positive or negative, on the volumes regarding the geopolitical. Maybe we cannot link it to what happened in the Red Sea a few years ago because this is totally different. We have some of the airlines, like for example, the Chinese airlines stopped flying into the region. We had some impacts in March with some of the GCC carriers, there was a bit of impact. On the other hand, the mix has changed. Yes, we can see that the import has increased significantly, and usually import cargo attracts higher revenue and higher yields.

Speaker #2: So, thank you very much. Let me explain about the cargo mix. Our volume growth, 9%, is in line with our forecast, so we haven't seen a significant increase in volumes other than normal business.

Speaker #2: And also, we haven't seen a big impact, positive or negative, on the volumes regarding the geopolitical. Maybe we cannot link it to what happened in the Red Sea a few years ago.

Speaker #2: Because this is totally different. We have some of the airlines—like, for example, the Chinese airline—stopped flying into the region. We had some impacts in March with some of the GCC carriers.

Speaker #2: So, there was a bit of an impact, but on the other hand, the mix has changed. Yes, we can see that the import has increased significantly.

Speaker #2: And usually, import cargo attracts higher revenue and higher yields, as well as some of the product mix. But there has not been a major shift in product mix—mainly the type of cargo.

Omar Hariri: As well as some of the product mix, there has not been a major shift in product mix, mainly the type of cargo, we've seen that there's more imports in the past period.

Speaker #2: We've seen that there were more imports in the past period.

Nada Abdel Malik: In the H2, do you think that we will see more mix towards transit, the blended price will go down accordingly? Do you expect the same trend we have seen in the Q2?

Speaker #3: So, in the second half, do you think that we will see more mix towards transit and then the blended price will go down accordingly, or do you expect the same trend we have seen in the second quarter?

Nada Abdel Malik: In the H2, do you think that we will see more mix towards transit, the blended price will go down accordingly? Do you expect the same trend we have seen in the Q2?

Speaker #2: I mean, it's uncertain what's going to happen in the remainder of the year in terms of the geopolitical situation. But what I can say for certain is that Saudi Arabia, as a country, has positioned itself well as the logistics hub.

Omar Hariri: It's uncertain what's going to happen in the remaining of the year in terms of the geopolitical situation. What I can say for certain, that Saudi Arabia as a country has positioned itself well that it's the logistics hub, now we're seeing a big diversion from companies and setting up in Saudi Arabia. We are going to see a trend of more imports into the country as well, direct imports into the country. How it will evolve in the future, we're still uncertain because it's a very dynamic situation.

Speaker #2: And now we're seeing the big diversion from companies and setting up in Saudi Arabia. So, we are going to see a trend of more imports into the country as well.

Speaker #2: Direct imports into the country. But how it will evolve in the future—we're still uncertain, because it’s a very dynamic situation.

Nada Abdel Malik: Very clear. Thank you, management, wish you all the best.

Speaker #3: Very clear. Thank you, management, and I wish you all the best.

Speaker #1: Thank you, Nada. So, we'll take our next question from the line of Sara Ben Mansour. Your line is now open. Please unmute yourself and proceed with your question.

Ali Adel: Thank you, Nada. We'll take our next question from the line of Sarah Bin Mansour. Your line is now open. Please unmute yourself and proceed with your question.

Sarah Bin Mansour: Hello, am I audible?

Sarah BinMansour: Hello, am I audible?

Speaker #3: Hello, am I audible?

Speaker #1: Yes, we can hear you.

Ali Adel: Yes, we can hear you.

Speaker #3: Okay. Thank you, management, for the presentation and congratulations on your results. My name is Sara Ben Mansour from SNB Capital. I just have one question.

Sarah Bin Mansour: Okay. Thank you, management, for the presentation, and congratulations on your results. My name is Sarah Bin Mansour from SNB Capital. I just have one question. It's almost slightly a follow-up on Nada's. It's regarding the blended revenue per ton. We understand that it's following the annualization of pricing adjustments that were introduced in mid-2025. However, would this be a benchmark revenue per ton, or was there more of a variance due to the current geopolitical situation?

Sarah BinMansour: Okay. Thank you, management, for the presentation, and congratulations on your results. My name is Sarah Bin Mansour from SNB Capital. I just have one question. It's almost slightly a follow-up on Nada's. It's regarding the blended revenue per ton. We understand that it's following the annualization of pricing adjustments that were introduced in mid-2025. However, would this be a benchmark revenue per ton, or was there more of a variance due to the current geopolitical situation?

Speaker #3: It's almost slightly a follow-up on Nada's. So, it's regarding the blended revenue per Tonne. We understand that it's following the annualization of pricing adjustments that were introduced in mid-2025.

Speaker #3: However, would this be a benchmark revenue per 10, or was there more of a variance due to the current geopolitical situation?

Speaker #2: Yeah, I think what we can say again—I think the biggest change we've seen this year, or in this quarter, is the change in the product mix, where we have more imports now.

Omar Hariri: Yeah, I think what we can say again, I think the biggest change we seen in this year or in this quarter is the change of the product mix, where we have more imports now. Usually, we have growth in imports and in transit and in exports, but predominantly, we've seen the significant growth in imports. As you're aware, imports attract the highest revenue and the highest yields for even landside revenue as well. That's the only change we've seen so far.

Speaker #2: Usually, we have growth in imports, in transit, and in exports, but predominantly, we've seen significant growth in imports. And as you're aware, imports attract the highest revenue and the highest yields—even for landside revenue as well.

Speaker #2: That's the only change we see so far.

Sarah Bin Mansour: Okay. Thank you so much.

Sarah BinMansour: Okay. Thank you so much.

Speaker #3: Okay. Thank you so much.

Omar Hariri: On the line.

[Unknown Speaker]: `On the line.

Speaker #1: Thank you, Sara. Thank you, management team. We'll take our next question from the line ending in 748. Your line is now open. Please unmute yourself.

Ali Adel: Thank you, Sora. Thank you, management team. We will take our next question from the line of Simon Fogate. Your line is now open. Please unmute yourself and proceed with your question.

Speaker #1: And proceed with your question.

Omar Hariri: Awesome.

Simon Fogate: Hello.

Faisal Al-Azmeh: Hello.

Speaker #4: Hello. Thank you, management, for the presentation and also congratulations on the great set of results. My question is with regard to the capacity expansion and the ground handling.

Omar Hariri: Hello.

Simon Fogate: Thank you, management, for the presentation, also congrats on the great set of results. My question is with regard to the capacity expansion and the ground handling. How should we think about it? How would that translate into volumes? If such capacity expansion did not take place, what would be the current capacity? If you can shed light on some of the mid- to long-term volume growth on the cargo handling side.

Faisal Al-Azmeh: Thank you, management, for the presentation, also congrats on the great set of results. My question is with regard to the capacity expansion and the ground handling. How should we think about it? How would that translate into volumes? If such capacity expansion did not take place, what would be the current capacity? If you can shed light on some of the mid- to long-term volume growth on the cargo handling side.

Speaker #4: How should we think about it? How would that translate into volumes? If such capacity expansion did not take place, what would be the current capacity? And if you can shed light on some of the mid- to long-term volume growth on the cargo handling side?

Omar Hariri: Thank you very much. As per the National Aviation Strategy, the country is aiming to reach about from 3.5 to 4 million tons a year. Today, the country is doing about 1.2 million tons. With all what's happening, we're seeing that Saudi Arabia is really planting itself as the leader in logistics in the region. We're seeing more demand of cargo airlines, more demand of logistics company moving into Saudi. Definitely expanding capacity is important for us, hence we've launched our expansion plan for our stations. We're planning to double capacity from today, nearly 1 million to about 2.2 million by end of 2028.

Speaker #2: So, thank you very much. I suppose the national aviation strategy, or the country, is aiming to reach about 3.5 to 4 million tons a year.

Speaker #2: Today, the country is doing about 1.2 million tons. With all that's happening, and we're seeing that Saudi Arabia is really planting itself as the leader in logistics in the region, we're seeing more demand for cargo airlines and more demand for logistics companies moving into Saudi.

Speaker #2: So, definitely, expanding capacity is important for us. And hence, we've launched our expansion plan for our stations. We're planning to double capacity from today, nearly one.

Speaker #2: ...million to about 2.2 million by the end of 2028.

Simon Fogate: Thanks so much. With regards to the recent acquisitions, you've mentioned that this is the first step into international expansion. I just wanted to know, because my previous understanding was that this is to allow the transits from China into Europe. If this is an entry into-

Faisal Al-Azmeh: Thanks so much. With regards to the recent acquisitions, you've mentioned that this is the first step into international expansion. I just wanted to know, because my previous understanding was that this is to allow the transits from China into Europe. If this is an entry into-

Speaker #4: Thank you so much. And with regards to the recent acquisitions, you've mentioned that this is the first step in international expansion. I just wanted to clarify, because my previous understanding was that this is meant to allow for the transit from China to Europe.

Speaker #4: But if this is an entry into a parade of international expansions, how would you reconsider the difference in margins between what you accrue here locally versus what you would get internationally?

Omar Hariri: Yeah

Simon Fogate: An array of international expansions, how would you conciliate the difference in margins between what you accrue here locally versus what you will get internationally?

Faisal Al-Azmeh: An array of international expansions, how would you conciliate the difference in margins between what you accrue here locally versus what you will get internationally?

Omar Hariri: Well, our international expansion will be studied carefully. We're not looking for a full-fledged expansion globally. We're targeting very strategic airports that will support our business in Saudi Arabia. As we said, one of the main reasons for us being there is that the national airlines, Saudia Airlines, is using Liege as the biggest hub for them in Europe. Connecting the North America to Saudi is very important. We have slightly less capacity direct from Saudi to North America, where Liege will help Saudia Airlines and other airlines to connect cargo from US into Saudi Arabia and also vice versa, China into Europe and US. It will give us also a leverage now that all airlines now are tending to go for global tendering when it comes to cargo handling.

Speaker #2: I mean, I would say international expansion would be studied carefully. We're not looking for a full-fledged expansion globally; we're targeting very strategic airports that will support our business in Saudi Arabia.

Speaker #2: As we said, one of the main reasons for us being there is that the national airline, Saudi Airlines, is using Liège as the biggest hub for them in Europe.

Speaker #2: And there is, and also, connecting the North Americas to Saudi is very important. We have slightly less capacity direct from Saudi to North America, where LEAGUE will help Saudi Airlines and other airlines to connect cargo from the US into Saudi Arabia, and also vice versa—China into Europe and US.

Speaker #2: Also, it will give us a leverage now that all airlines are now tending to go for global tendering when it comes to cargo handling.

Omar Hariri: This airport, because of its significance and importance, will give us leverage now when we go into tendering to give bundled solutions as well.

Speaker #2: This airport, because of its significance and importance, will give us leverage now when we go into tendering to offer bundled solutions as well.

Simon Fogate: Thank you so much. My last question is with regards to your margins and if there are any potential risks from the host airports in Saudi of imposing higher concession fees.

Faisal Al-Azmeh: Thank you so much. My last question is with regards to your margins and if there are any potential risks from the host airports in Saudi of imposing higher concession fees.

Speaker #4: Thank you so much. My last question is with regards to your margins, and if there are any potential risks from the host airports in Saudi of imposing higher concession fees.

Omar Hariri: Well, our concessions are set already. They're long-term contracts. Some of them are 30 years, some of them are 40 years. There's no risk on changing in terms of the pricing structure there. As for of the margins, we've steadily proven that we're keeping our margins on very healthy levels for many periods now, and we'll continue to do so.

Speaker #2: Well, our concessions are set already. They're long-term contracts—some of them are 30 years, some of them are 40 years. So there's no risk of change in terms of the pricing structure there.

Speaker #2: As for the margins, we've steadily proven that we're keeping our margins at very healthy levels for many periods now, and we'll continue to do so.

Simon Fogate: Thank you, sir.

Faisal Al-Azmeh: Thank you, sir.

Speaker #4: Thank you so much.

Ali Adel: Thank you, management team. We'll take our next question from the line of Abdullah Pes. Your line is now open. Please proceed with your question.

Speaker #1: Thank you, management team. We will take our next question from the line of Abdullah Abbas. Your line is now open. Please proceed with your question.

Abdullah Pes: Hello, management. Congratulations on the result. Can you hear me?

[Analyst 1]: Hello, management. Congratulations on the result. Can you hear me?

Speaker #5: Hello, management. Congratulations on the result. Can you hear me?

Ali Adel: Yes, we can hear Abdullah. Please proceed.

Speaker #1: Yes, we can hear you, Abdullah. Please proceed.

Abdullah Pes: Okay, perfect. I want to understand more on the airline capacity that has been impacted. I know that passenger aircrafts have also bring into the cargo. How much of impact it has led to in terms of capacity for the airlines that are being handled? Do you see a growth when things will normalize? How will more deliveries or airplane deliveries impact your ability to handle more cargo? Thank you.

[Analyst 1]: Okay, perfect. I want to understand more on the airline capacity that has been impacted. I know that passenger aircrafts have also bring into the cargo. How much of impact it has led to in terms of capacity for the airlines that are being handled? Do you see a growth when things will normalize? How will more deliveries or airplane deliveries impact your ability to handle more cargo? Thank you.

Speaker #5: Okay, perfect. So I wanted to understand more about the airline capacity that has been impacted. I know that passenger aircraft have also been used for cargo.

Speaker #5: So how much of an impact has it had in terms of capacity for the airlines that are being handled? And do you see growth when things normalize, or how will more deliveries, or airplane deliveries, impact your ability to handle more cargo?

Omar Hariri: Thank you. Thank you very much. On the contrary, we haven't seen a drop in capacity. We've recorded 9% growth in this quarter. Initially, we had some, during the first couple of weeks of the disruption, yes, some of the GCC carriers stopped flying, and until now, also the Chinese carriers stopped flying to the whole Middle East. Cargo is not like passengers. Cargo must find its way. There are different carriers. We've signed with new carriers as well. First-time carriers are coming to Saudi. The cargo eventually will route itself into the country. We haven't seen any drop in capacity so far, and we estimate this will also stay until the end of the year.

Speaker #5: Thank you.

Speaker #2: Thank you. Thank you very much. On the contrary, we haven't seen a drop in capacity. We've recorded 9% growth in this quarter. Initially, during the first couple of weeks of the disruption, yes, some of the GCC carriers stopped flying, and until now, also, the Chinese carriers have stopped flying to the whole Middle East.

Speaker #2: But cargo is not like passengers. Cargo must find its way, so there are different carriers. We've seen new carriers as well—first-time carriers are coming to Saudi.

Speaker #2: So, the cargo eventually will route itself into the country. So, Alhamdulillah, we haven't seen any drop in capacity so far, and we estimate this will also stay until the end of the year.

Abdullah Pes: A follow-up question in regards to the cargo mix is, how much of the cargo was transit? How much do you expect it to be purely for Saudi as well?

[Analyst 1]: A follow-up question in regards to the cargo mix is, how much of the cargo was transit? How much do you expect it to be purely for Saudi as well?

Speaker #5: And a follow-up question in regards to the cargo mix. Is how much of the cargo was transit was how much do you and how much do you expect to be purely for Saudi as well?

Abdullah Pes: Has the war situation led to an increase in transit cargo? How do you see that increase translating into a permanent increase? Just more color on this aspect of cargo. Thank you. Thank you so much.

[Analyst 1]: Has the war situation led to an increase in transit cargo? How do you see that increase translating into a permanent increase? Just more color on this aspect of cargo. Thank you. Thank you so much.

Speaker #5: And has the war situation led to an increase in transit cargo? And do you—how do you see that increase translating into a permanent increase, or is it just more color on this aspect of cargo?

Omar Hariri: Thank you. Again, our focus is always on imports or recorded gateway cargo, whether it's export or import, because it attracts higher revenue and yields. Transit is a good product that supports the airline, supports the country, and we also support it, but usually it comes with a lower revenue and a lower yield. The imports is where we've seen the growth in the Q2. Also, during the beginning of the disruption, we have received a little bit more volumes on transit to the GCC. We've used, for example, Qaisumah Airport, Dammam Airport, Riyadh Airport for shipments to the distance to these GCC countries as well. This faded away once those countries went back into normal operation.

Speaker #5: Thank you. Thank you so much.

Speaker #2: Thank you. Again, our focus is always on import, or what we call gateway cargo, whether it's export or import, because it attracts higher revenue and yields.

Speaker #2: Transit is a good product that supports the airline and supports the country. And we'll also support it, but usually it comes with lower revenue and a lower yield.

Speaker #2: So, the imports are where we've seen the growth in Q2. And also, during the beginning of the disruption, we received a little bit more volumes in transit to the GCC.

Speaker #2: We've used, for example, Qaisoma Airport, Dammam Airport, and Riyadh Airport for shipments destined to GCC countries as well. But this faded away once those countries went back into normal operation.

Abdullah Pes: Thank you. Thank you.

[Analyst 1]: Thank you. Thank you.

Speaker #5: Thank you. Thank you for that.

Ali Adel: Thank you, management team. We'll take our next question from the line of Alawi. Your line is now open. Please proceed with your question.

Speaker #1: Thank you, management team. We'll take our next question from the line of Fallawi. Your line is now open. Please proceed with your question.

[Analyst]: Hi, thank you for the call. Just a one follow-up in terms of the import. What would you say is driving it more? Is it more the companies increasing their inventory levels given what's happened with the regional conflict, or you see more companies setting up in Saudi Arabia, you highlighted, due to the logistic focus of the country?

[Analyst 2]: Hi, thank you for the call. Just a one follow-up in terms of the import. What would you say is driving it more? Is it more the companies increasing their inventory levels given what's happened with the regional conflict, or you see more companies setting up in Saudi Arabia, you highlighted, due to the logistic focus of the country?

Speaker #6: Hi. Thank you for the call. Just one follow-up in terms of the import. What would you say is driving it more? Is it more that companies are increasing their inventory levels given what's happening with the regional conflict, or do you see more companies setting up in Saudi Arabia, as you highlighted, due to the logistics focus of the country?

Omar Hariri: I believe it's a mix of everything what you said, but mainly what we're seeing really significantly is we're seeing a lot of companies moving into Saudi Arabia, creating their distribution centers. Also the demand of the Saudi market. The big projects are still ongoing, and we're seeing also the energy sector as well is growing because of the oil prices increase. There is a lot of operations happening. It's a mix of both, but mainly what I can see the difference is majority of the companies moving into Saudi and using it as a distribution hub.

Speaker #2: I believe it's a mix of everything you mentioned, but mainly what we're seeing, really significantly, is a lot of companies moving into Saudi Arabia and creating their distribution centers.

Speaker #2: Also, the demand in the Saudi market—the big projects are still ongoing. We're seeing the energy sector as well is growing because oil prices have increased.

Speaker #2: So there's a lot of operations happening. It's a mix of both, but mainly we're seeing—what I can see—the difference is some of the majority of the companies moving into Saudi and using it as a distribution hub.

[Analyst]: Thank you. Thank you very much.

[Analyst 2]: Thank you. Thank you very much.

Speaker #6: Thank you. Thank you very much.

Ali Adel: Thank you. We'll take our next question from the line of Bashayer. Your line is now open. Please unmute yourself and proceed with your question.

Speaker #1: Thank you. We'll take our next question from the line of Bashair. Your line is now open. Please unmute yourself and proceed with your question.

Bashayer Shuaib: Good evening, management. Am I audible?

Speaker #7: Hi, good evening, management. Am I audible? Am I audible, or is it…?

Omar Hariri: Yes, you're audible.

Speaker #2: Yes. Yes. Yes.

Bashayer Shuaib: Okay. Congrats on the great set of results. I'm Bashayer Shuaib from Al Rajhi Asset Management Team. On the financing and Sukuk program, how is it going to work? Is the financing cost going to be capitalized or expensed? That's my question. Thank you.

Speaker #7: Okay. Congrats on the great set of results. I'm sure you should ask the management team about the financing and the COOK program. How is it going to work?

Speaker #7: Is the financing cost going to be capitalized or expensed? That's my question. Thank you.

Haydar Yuksel: I think I'll jump on this one. Thank you for that. For the Sukuk-related expenses, obviously, that's a general Sukuk that has been done on the head office level. That's not something that we have under its own company as a whole. But we do have a lot of projects that we are able to capitalize as a general borrowing concept, which we started initiating from Q2 onwards. Yes, we can capitalize a great deal of the interest costs related to general borrowing structure.

Haydar Ucar: I think I'll jump on this one. Thank you for that. For the Sukuk-related expenses, obviously, that's a general Sukuk that has been done on the head office level. That's not something that we have under its own company as a whole. But we do have a lot of projects that we are able to capitalize as a general borrowing concept, which we started initiating from Q2 onwards. Yes, we can capitalize a great deal of the interest costs related to general borrowing structure.

Speaker #2: Oh, I think I'll jump in on this one. So thank you for that. For the Sukuk-related expenses, obviously those are general Sukuk that have been done at the head office level.

Speaker #2: So that's not something that we have in this company as a whole. But we do have a lot of projects that we are able to capitalize on as a general involvement concept, which we started initiating from Q2 onwards.

Speaker #2: So yes, we can capitalize a great deal of the interest costs related to the general borrowing structure.

Bashayer Shuaib: Is it partially capitalized or is it fully?

Speaker #7: Is it partially capitalized, or is it fully?

Haydar Yuksel: No, it won't be fully. It will be partially, but a big majority of those will be.

Haydar Ucar: No, it won't be fully. It will be partially, but a big majority of those will be.

Speaker #2: No, it won't be fully. It will be partially, but a big majority of those.

Bashayer Shuaib: Okay. Thank you. Thank you.

Speaker #7: Okay. Thank you. Thank you.

Ali Adel: Thank you, management team. We'll take some questions from the Q&A box. I already see many questions asking about the volume mix and the reason behind the increase in imports volume this quarter. If you can maybe want to elaborate more.

Speaker #1: Thank you, management team. We'll now take some questions from the Q&A box. I already see many questions asking about the volume mix and the reason behind the increase in imports volume this quarter.

Speaker #1: So, if you can, maybe you want to elaborate more.

Omar Hariri: I think we had several questions regarding imports. I think we've explained it. Unless if there's anything in specific, we will be happy to answer.

Speaker #2: I think we had several questions regarding imports. I think we've explained it. Unless there's anything specific, we will be happy to answer.

Ali Adel: Okay. Maybe there is a certain question regarding giving the contribution or explaining the contribution of maybe the old contracts or existing ones compared to the new contract, if there is more color, if you want to share about this point.

Speaker #1: Okay. So maybe there’s a certain question regarding giving the contribution or explaining the contribution of maybe the old contracts or existing ones compared to the new contracts. If there is more color, if you want to share about this point.

Omar Hariri: Yeah. Thank you. Of course, we're in a very competitive environment, but the good thing is that nearly 70% of our revenue is coming from landside, where we have the 70% of our revenues. In terms of our contracts, we are importantly now thinking of long-term strategic contracts with our customers. We have seen that we've signed with Emirates five years and with Qatar Airways three years. We had very successful in retaining our customers and expanding them strategically on long-term deals.

Speaker #2: Yeah, thank you. Yes, and of course, we're in a very competitive environment. But the good thing is that nearly 70% of our revenue is coming from landside, where we have 70% of our revenues.

Speaker #2: In terms of our contracts, we are importantly now thinking of long-term strategic contracts with our customers. So, we have seen that we've signed with Emirates for five years and with Qatar Airways for three years.

Speaker #2: So, we have been very, very successful in retaining our customers and expanding them strategically through long-term deals.

Ali Adel: Thank you, management. There's another question asking about if you are planning for further international acquisitions for expansions.

Speaker #1: Thank you, management. There's another question asking if you are planning for further international acquisitions or expansions.

Omar Hariri: Yeah. In terms of cargo handling, at this stage, no, but we are carefully studying strategic airports that are going to benefit our Saudi business. It has to come and give value to our Saudi business, first of all. At this stage, for now, Riyadh is going to be our first, and we're going to study further airports in the future if it makes sense for us and improves our Saudi business.

Speaker #2: Yeah. In terms of cargo handling—at this stage, no. But we are carefully studying strategic airports that are going to benefit our Saudi business.

Speaker #2: So, it has to come and give value to our Saudi business, first of all. But at this stage, for now, Riyadh is going to be our first, and we're going to study further airports in the future if it makes sense for the business.

Ali Adel: Thank you. There's a question related to the logistics segment. There are several questions, mainly part of it is the transportation pricing still stretched since the start of the disruptions? Another question mentioning when the logistics segment will start to be profitable based on your plans.

Speaker #1: Thank you. There's a question related to the logistics segment. There are several questions, and mainly, part of it is about whether transportation pricing is still stretched since the start of the disruptions.

Speaker #1: And another question: when will the logistics segment start to be profitable, based on your plans?

Omar Hariri: Yeah. Well, of course, trucking prices has definitely increased during the crisis because of the lack of capacity. We're seeing that now there's significant projects as well, and to ensure that smooth transition between borders will make it easier down the line. As for logistics, we were doing our turnaround plan, and we were expecting by end of the year that the company is on a very strategic path to ensure sustainable profitability, inshallah.

Speaker #2: Yeah. Well, of course, trucking prices have definitely increased during the crisis because of the lack of capacity. But we're seeing that now there are significant projects as well to ensure that smoothing this transition between borders will make it easier down the line.

Speaker #2: As for logistics, we were executing our turnaround plan and were expecting that by the end of the year, the company will be on a very strategic path to ensure sustainable profitability, inshallah.

Ali Adel: Okay. Thank you. I think we have several investors raising their hands, so we'll take our next question from the line of Sayed Akhtar. Your line is now open. Please unmute yourself and proceed with your question.

Speaker #1: Okay, thank you. I think we have several investors raising their hands, so we'll take our next question from the line of Said Akhtar. Your line is now open.

Speaker #1: Please unmute yourself and proceed with your question.

Sayed Akhtar: Hello? Hello. First of all, thank you for the presentation and congratulations on the good results. I have a question regarding the sustainability of the profitability at SAR 191 million level, going forward. If I remember, the management communicated that the average or the sustainable bottom line would be around SAR 150 to 180 million. Do you think that SAR 191 million or SAR 200 million bottom line will be sustainable going forward?

Speaker #4: Hello, hello. First of all, thank you for the presentation and congratulations on the good results. I have a question regarding the sustainability of the profitability at the 191 million level going forward.

Speaker #4: Because if I remember, the management communicated that the average or the sustainable bottom line would be around 150 to 180 million. So do you think that 191 million or 200 million bottom line will be sustainable going forward?

Omar Hariri: I will leave this to Haydar, but as you know, cargo business is cyclical. It depends on the quarter and depends on the available demand capacity. We've produced similar, even higher results in previous quarters as well. We'll stick with our guidance, that about mid to high single digits before end of the year in terms of the growth of volumes. I don't know, Haydar, if you have anything to add.

Speaker #2: I will leave this to Haider, but as you know, the cargo business is cyclical. It depends on the quarter, and it depends on the available demand and capacity.

Speaker #2: We've produced similar even higher results in previous quarters as well. But we'll stick with our guidance that about mid to high single digits before end of the year in terms of the growth of volumes.

Speaker #2: But I don't know, Haider, if you have anything to add.

Haydar Yuksel: No, I think, Omar, you explained it very well. Obviously we have a lot of cyclicality and seasonality. In Q2 and Q1, in addition to those normal cyclicalities, we also had the geopolitical disruption. Obviously, there was a little bit of changes in between volumes from one period to the other. As our business model is extremely operated at a very high operating leverage, any additional volumes gives us a significant impact on the bottom line. We will have that kind of volatility depending on quarters and volumes and so on, but we at least have a very strong structure in place. We have a sustainable model in place in terms of a very good cost base in the most key drivers of the business. Obviously, we very much set forward to be able to capitalize on all additional volumes that will come in.

Haydar Ucar: No, I think, Omar, you explained it very well. Obviously we have a lot of cyclicality and seasonality. In Q2 and Q1, in addition to those normal cyclicalities, we also had the geopolitical disruption. Obviously, there was a little bit of changes in between volumes from one period to the other. As our business model is extremely operated at a very high operating leverage, any additional volumes gives us a significant impact on the bottom line. We will have that kind of volatility depending on quarters and volumes and so on, but we at least have a very strong structure in place. We have a sustainable model in place in terms of a very good cost base in the most key drivers of the business. Obviously, we very much set forward to be able to capitalize on all additional volumes that will come in.

Speaker #3: No, I think my view explained it very, very well. So, obviously, we have a lot of cyclicality and seasonality. And in Q2 and Q1, in addition to those normal cyclicality effects, we also had the geopolitical disruption.

Speaker #3: Obviously, there was a little bit of changes in between volumes from one period to the other. And as our business model is extremely at an operate at a very high operating leverage, any additional volumes gives us significant impact on the bottom line.

Speaker #3: So, we will have that kind of volatility depending on quarters and volumes, and so on. But we at least have a very strong structure in place.

Speaker #3: We have a sustainable model in place in terms of a very good cost base in the most key drivers of the business. So, obviously, we are very much set forward to be able to capitalize on all additional volumes that will come in.

Haydar Yuksel: We obviously extremely confident about the growth of the Kingdom's volume, and basically as Saudi Arabia as a transit hub and as a distribution place in coming years as well. We just felt very positive for the output that we at least are carrying for ourselves going forward in years ahead.

Haydar Ucar: We obviously extremely confident about the growth of the Kingdom's volume, and basically as Saudi Arabia as a transit hub and as a distribution place in coming years as well. We just felt very positive for the output that we at least are carrying for ourselves going forward in years ahead.

Speaker #3: And we are obviously extremely confident about the growth of the Kingdom's volume, and basically Saudi Arabia as a transit hub and as a distribution place in the coming years as well.

Speaker #3: So, we definitely are very positive about the output that we, at least, are carrying for ourselves going forward in the years ahead.

Sayed Akhtar: Okay. Thank you.

Speaker #4: Okay. Thank you.

Ali Adel: Thank you. I will take our next question from the line of Abdullah Al-Hindi. Your line is now open. Please unmute yourself and proceed with your question.

Speaker #1: Thank you. Okay, our next question is from the line of Abdullah Al-Hindi. Your line is now open. Please unmute yourself and proceed with your question.

Abdullah Al-Hindi: Thank you. Thank you, management. Congrats on the results. I just have one question regarding the cargo handling business. Just can you shed some color on the quarter performance in terms of belly shipment versus dedicated cargo planes. What is the situation there? Yes, you commented on the kind of shipment, whether import, export, or planned shipment. I want to see what is the situation when it comes to aviation in general. Did that volume come from dedicated cargo airplanes or what?

Abdullah Alhindi: Thank you. Thank you, management. Congrats on the results. I just have one question regarding the cargo handling business. Just can you shed some color on the quarter performance in terms of belly shipment versus dedicated cargo planes. What is the situation there? Yes, you commented on the kind of shipment, whether import, export, or planned shipment. I want to see what is the situation when it comes to aviation in general. Did that volume come from dedicated cargo airplanes or what?

Speaker #5: Thank you. Thank you, management, and congrats on the results. I just have one question regarding the cargo handling business. Could you shed some light on the quarterly performance in terms of belly shipment versus dedicated cargo planes?

Speaker #5: What's the situation there? Yes, you commented on the kind of shipment, whether import, export, or transshipment. But I want to see—what's the situation when it comes to aviation in general?

Speaker #5: Did you see, did that volume come in, come from dedicated cargo airplanes or what?

Omar Hariri: Thank you very much. We haven't seen significant change, maybe only with couple of GCC carriers where they used to deploy freighters into Saudi. Because of the disruption globally, they started using more passenger flights because of proximity of the flight rather than and keeping the freighters for longer haul. On the other hand, we see new cargo planes, new cargo airlines coming into Saudi. The mix hasn't changed dramatically in this quarter.

Speaker #2: Thank you very much. We haven't seen a significant change, maybe only with a couple of GCC carriers, where they used to deploy freighters into Saudi.

Speaker #2: But because of the disruption globally, they started using more passenger flights because of the proximity of the flights, and kept the freighters for longer hauls.

Speaker #2: On the other hand, we see new cargo planes and new cargo airlines coming into Saudi. So the mix hasn't changed dramatically in this quarter.

Ali Adel: Okay. Thank you, management team. We'll take our next question from the line of Ahmed Arif. Your line is now open. Please unmute yourself and proceed with your question.

Speaker #1: Okay, thank you, management team. We'll take our next question from the line of Ahmad Arif. Your line is now open. Please unmute yourself and proceed with your question.

Ahmed Arif: As-salamu alaykum. This is Ahmed Arif from Al Jazira Capital Asset Management. I've just got a very small question on the new carrier agreements, so with the different airlines, such as your Singapore Airlines and stuff. Would it be possible to get a sense of the expected incremental volume or revenue contribution that these agreements could bring in H2? If there's any specific structures, it would be great to get some light shed on that.

Speaker #6: Assalamualaikum. This is Ahmad Arif from Jazeera Capital Asset Management. I just have a very small question on the new carrier agreements. With the different airlines, such as Singapore Airlines and others, would it be possible to get a sense of the expected incremental volume or revenue contribution that these agreements could bring in the second half?

Speaker #6: And if there are any specific structures, it would be great to get some light shed on that.

Omar Hariri: Well, definitely it will have a positive impact on the volumes because there are new airlines, totally new to SAL. We can't anticipate the exact volume number, but we expect once the operation started to ramp up, we see a positive, inshallah, growth in terms of the volumes from those new carriers.

Speaker #2: It will definitely have a positive impact on the volumes, because there are new airlines—totally new—to sell. We can't anticipate the exact volume number, but we expect that once the operation starts to ramp up, we will see, inshallah, positive growth in terms of volumes from those new carriers.

Ahmed Arif: Just a quick follow-up if that's okay. Is there any specific timeframes in the agreements you've had with these new carriers, or are there any structures that have been specified?

Speaker #6: Just a quick follow-up, if that's okay. Are there any specific time frames in the agreements you've had with these new carriers? Or are there any structures that have been specified?

Omar Hariri: No. We've used the general cargo handling agreement that's used by IATA worldwide. It's nothing specific there. We're ready for their flights once they schedule them. It's a normal proposal or offer being given to them, standard agreement by cargo handling.

Speaker #2: No, we've used the general cargo handling agreement that's used by IATA worldwide, so there's nothing specific there. And we're ready for their flights once they schedule them.

Speaker #2: And it's a normal proposal or offer being given to them—a standard agreement by cargo handling.

Ahmed Arif: Thank you.

Speaker #6: Thank you.

Ali Adel: Okay. Thank you, management. We'll take our next question from the line of Saleh Almuhaizeen. Your line is now open. Please unmute yourself and proceed with your question.

Speaker #1: Okay, thank you, management. We'll take our next question from the line of Saleh. Your line is now open. Please unmute yourself and proceed with your question.

Saleh Almuhaizeen: As-salamu alaykum. Am I audible?

Saleh Almuhayzi: As-salamu alaykum. Am I audible?

Speaker #7: Assalamualaikum. Am I audible?

Ali Adel: Yes, we can hear you. Go ahead.

Saleh Almuhaizeen: Okay. This is Saleh Almuhaizeen from Portolls Investments. Thank you, management, for this call. My question is on the newly acquired company. When applying your EBITDA multiple and getting its EBITDA divided by volumes handled there, I can see there is a huge difference from SAL handling business versus your newly acquired company. I know EBITDA is not a good proxy, but should we assume this much lower pricing in the new company versus SAL? If so, is this the normal level of profitability, or should we assume this is the normal level of profitability or not?

Saleh Almuhayzi: Okay. This is Saleh Almuhaizeen from Portolls Investments. Thank you, management, for this call. My question is on the newly acquired company. When applying your EBITDA multiple and getting its EBITDA divided by volumes handled there, I can see there is a huge difference from SAL handling business versus your newly acquired company. I know EBITDA is not a good proxy, but should we assume this much lower pricing in the new company versus SAL? If so, is this the normal level of profitability, or should we assume this is the normal level of profitability or not?

Speaker #1: Yes, we can hear you. Go ahead.

Speaker #7: Okay. Yeah. This is Saleh Al-Mahiz from Portoise Investments. Thank you, management, for this call. My question is on the newly acquired company. So, when applying your EBITDA multiple and getting its EBITDA divided by volumes handled there, I can see there is a huge difference from SAL's handling business versus your newly acquired company.

Speaker #7: And I know EBITDA is not a good proxy, but should we assume this much lower pricing in the new company versus Sale? And if so, is this the normal level of profitability, or should we assume this is the normal level of profitability or not?

Omar Hariri: Well, couple of things. First, the reasons of acquiring Aviapartner is strategic. As I said, it gives us more leverage for us to secure our Saudi business and secure our customers in Saudi Arabia by giving abundant solutions. Yes, we know worldwide probably the margins of cargo handling is different than Saudi Arabia. Again, the main aim was to strengthen our Saudi business and to retain our customers. On the other hand, Aviapartner is predominantly a passenger handling, and they had a small cargo operations. For us in SAL, we are a cargo expert, cargo operations, so we have a lot of headroom to grow that business commercially and to attract more volumes. Also to attract the national carrier of Saudi Arabia, Saudia Cargo, potentially could be one of the new customers there that will attract more volumes, inshallah.

Speaker #2: Well, a couple of things. First, this is the reason for acquiring other partners strategically, as I said. It gives a small leverage for us to secure our Saudi business and to secure our customers in Saudi Arabia by giving built-in solutions.

Speaker #2: Yes, we know worldwide, probably the margins or cargo handling is different in Saudi Arabia. But again, the main aim was to strengthen our Saudi business and to retain our customers.

Speaker #2: On the other hand, the other partner is predominantly in passenger handling, and they have small cargo operations. For us in SAL, we are cargo experts, focused on cargo operations.

Speaker #2: So we have a lot of headroom to grow that business commercially and to attract more volumes. And also to attract the national carrier of Saudi Arabia—Saudi Cargo—which potentially could be one of the new customers there that will attract more volumes, inshallah.

Saleh Almuhaizeen: Okay. Thank you, management.

Saleh Almuhayzi: Okay. Thank you, management.

Speaker #7: Okay. Thank you, management.

Ali Adel: Thank you, management. If you allow me, there's several questions on the Q&A. Maybe I will read them fast. First question, please. Are you still maintaining your medium-term guidance of EBITDA margin of 35%?

Speaker #1: Thank you, management. If you allow me, there are several questions in the Q&A. Maybe I will read them quickly. So, first question, briefly: Are you still maintaining your medium-term guidance of an EBITDA margin of 35%?

Haydar Yuksel: I can maybe jump into that one quickly. Obviously when we gave that initial 35% by 2027, 2028 at the Capital Markets Day, our expectation was obviously that we would have grown our logistics business with an inorganic growth in acquisition. We still very much have that strategy in mind. We want to grow our logistics business inorganically, either via JVs or acquisitions, and obviously leapfrog the business. Obviously with the growth of the logistics business, our margin profile in the company on a blended scale will obviously change. Right now, we really haven't found those opportunities that really has the match and the fit that we are looking for. Probably if we will not reach that level by 2027, it will probably be deferred to later stages once we get that kind of growth in the logistics business.

Haydar Ucar: I can maybe jump into that one quickly. Obviously when we gave that initial 35% by 2027, 2028 at the Capital Markets Day, our expectation was obviously that we would have grown our logistics business with an inorganic growth in acquisition. We still very much have that strategy in mind. We want to grow our logistics business inorganically, either via JVs or acquisitions, and obviously leapfrog the business. Obviously with the growth of the logistics business, our margin profile in the company on a blended scale will obviously change. Right now, we really haven't found those opportunities that really has the match and the fit that we are looking for. Probably if we will not reach that level by 2027, it will probably be deferred to later stages once we get that kind of growth in the logistics business.

Speaker #4: I can maybe jump into that one quickly. So, obviously, when we gave that initial 35% in by 2027 or 2028 at the Capital Markets Day, our expectation was obviously that we would have grown our logistics business with inorganic growth in acquisition.

Speaker #4: So we still very much have that strategy in mind. We want to grow our logistics business inorganically, either via JVs or acquisitions. And obviously, we proctor business.

Speaker #4: And obviously, with the growth of the logistics business, our margin profile in the company on a blended scale will obviously change. But right now, we really haven't found those opportunities that really have the match and the fit that we are looking for.

Speaker #4: So, probably we will not reach that level by 2027. It will probably be deferred to later stages, once we get that kind of growth in the logistics business.

Ali Adel: Following on this point, there's a question mentioning on the logistics warehousing utilization rate in Q2. Was this related to the geopolitical situation, and how should we expect the utilization going forward?

Speaker #1: And following up on this point, there's a question regarding the logistics warehousing utilization rate in Q2. Was this related to the geopolitical situation, and how should we expect the utilization rate going forward?

Haydar Yuksel: Well, I can maybe just quickly give a quick color on that one. Obviously there was a lot more demand for warehouse capacity, trucking capacity, following the geopolitical situation. We already always knew that. That's why we obviously were looking into this own project and so on from our side. We have seen those demands coming in and being there for a long time. I think the rest of the world also now saw it. It did help us in terms of increased utilization in our warehouses. We also were consolidating smaller warehouses and so on. Those have been pipeline operations that are more or less executed at the same time. It does definitely give much more client communications and a stronger pipeline for us. I think it's a combination of both.

Haydar Ucar: Well, I can maybe just quickly give a quick color on that one. Obviously there was a lot more demand for warehouse capacity, trucking capacity, following the geopolitical situation. We already always knew that. That's why we obviously were looking into this own project and so on from our side. We have seen those demands coming in and being there for a long time. I think the rest of the world also now saw it. It did help us in terms of increased utilization in our warehouses. We also were consolidating smaller warehouses and so on. Those have been pipeline operations that are more or less executed at the same time. It does definitely give much more client communications and a stronger pipeline for us. I think it's a combination of both.

Speaker #4: Well, I can maybe just quickly give a quick call on that one. So, obviously, there is a lot more demand for warehouse capacity and trucking capacity following the geopolitical situation.

Speaker #4: We always knew that. That's why we were obviously looking into the zone project and so on from our side. So we have seen those demands coming in and being there for a long time.

Speaker #4: But I think the rest of the world also now saw it, so it did help us in terms of increasing utilization in our warehouses.

Speaker #4: But we were also consolidating smaller warehouses and so on. So those have been pipeline operations that were more or less executed at the same time.

Speaker #4: But it does definitely give much more, much more client communications and a stronger pipeline for us, so I think it's a combination of both.

Ali Adel: Thank you, Haitham. It seems that we don't have any further questions, I'll pass on the call back to the management team if they have any final remarks.

Speaker #1: Thank you, Haider. It seems that we don't have any further questions, so I'll pass the call back to the management team to see if they have any final remarks.

Omar Hariri: Thank you very much. It was a great pleasure being with you today, inshallah, we'll see you in the next quarter. Thank you.

Speaker #2: Thank you very much. It was a great pleasure being with you today. And inshallah, we'll see you in the next quarter. Alhamdulillah. Thank you.

Haydar Yuksel: Thank you, everyone. Thank you, Ali and Al Ramz. Bye.

Haydar Ucar: Thank you, everyone. Thank you, Ali and Al Ramz. Bye.

Speaker #4: Thank you, everyone. Thank you, Ali. And I'll come to you. Bye.

Ali Adel: Thank you. Thank you, management team, and thank you for all participants for joining us today. You can now disconnect.

Speaker #1: Thank you. Thank you, management team, and thank you for all participants for joining us today. You can now disconnect.

Ahmed Arif: Goodbye.

Browse all earnings call transcripts

Q2 2026 SAL Saudi Logistics Services Co Earnings Call

Request TrialDemo

SAL Saudi Logistics Services

Earnings