Half Year 2026 Shell Oman Marketing Co SAOG Earnings Call

August 25, 2026

Mahmoud Al Abri: How about the other attendees? Team, can you all hear me who are in the call now? Eric, can you hear me? Because I see you on mute. I assume that we want to make sure that can anyone please unmute themselves and just confirm to us that you can hear me? Farouk, you can still hear us, right?

Speaker #1: About our— The other attendees? Yeah.

Speaker #2: So, the thing— Can you all hear me? Who is on the call now? Rick, can you hear me? Because I see you unmuted. Can I assume that he doesn't— I just want to make sure that— Can anyone please unmute themselves and just confirm to us that you can hear me?

Speaker #2: You can still hear us, right?

Speaker #3: Yes, we can hear you.

Operator: Yes, we can hear you.

Speaker #2: Oh, fantastic. I think we can start. I think everyone is involved. So, good morning, everyone. I hope you can also see the screen.

Mahmoud Al Abri: Oh, fantastic. I think we can start. I think everyone is on board. Good morning, everyone. I hope you can also see the screen. Can you also confirm?

Speaker #2: Can you also confirm?

Speaker #3: Yes, we can see.

Operator: Yes, we can see.

Speaker #2: Oh, fantastic. So, good morning again to everyone, and thank you for joining us today. Before we get into our discussion today, I just want to make sure that everyone takes this call from a safe place.

Mahmoud Al Abri: Oh, fantastic. Good morning again to everyone, and thank you for joining us today. Before we get into our discussion today, I just want to make sure that everyone is at this call in a safe place. On behalf of Shell Oman Marketing, I would like again to extend our warm welcome to all of you. Today, we will provide an overview on our business performances, key priorities, and achievements for the first 6 months of 2026. This is how the agenda will look like. We will spend the first 20 to 30 minutes presenting to you different business performances from different line of businesses at Shell Oman Marketing. Sorry. The second half of the session will actually allow for any Q&A. If you have any questions, leave it to the end.

Mahmoud Al Abri: Oh, fantastic. Good morning again to everyone, and thank you for joining us today. Before we get into our discussion today, I just want to make sure that everyone is at this call in a safe place. On behalf of Shell Oman Marketing, I would like again to extend our warm welcome to all of you. Today, we will provide an overview on our business performances, key priorities, and achievements for the first six months of 2026. This is how the agenda will look like. We will spend the first 20 to 30 minutes presenting to you different business performances from different line of businesses at Shell Oman Marketing. Sorry. The H2 of the session will actually allow for any Q&A. If you have any questions, leave it to the end.

Speaker #2: On behalf of Shell Oman Marketing, I would like to once again extend our warm welcome to all of you. Today, we will provide an overview of our business performance, key priorities, and achievements.

Speaker #2: For the first six months of 2026, this is how the agenda will look. We will spend the first 20 to 30 minutes presenting to you different business performances from different lines of business.

Speaker #2: Of Shell Oman Marketing. Sorry? In the second half of the session, we will actually allow for any Q&A, so if you have any questions, please leave them until the end.

Speaker #2: You can either unmute yourself or write your question in the chat box. If you can unmute yourself, at least for the first 20 to 30 minutes, I'd be very grateful to you.

Mahmoud Al Abri: You can either unmute yourself, or you can write your question on the chat box. If you can unmute yourself, at least for the first 20 to 30 minutes, I will be very grateful to you. Again thank you for joining. Despite actually we have been operating in a very dynamic situation, Shell Oman Marketing continue to deliver resilient results while actually still focusing on safety, operational excellence, customer value, and sustainable growth. Let me start actually what really matters most to Shell Oman Marketing, which is safety. Safety to our people, to our contractors, partners, and the society, and the environment we work at. For the first 6 months, actually, the company has scored outstanding results when it comes to safety. Zero harm to people and zero process and safety leaks.

Mahmoud Al Abri: You can either unmute yourself, or you can write your question on the chat box. If you can unmute yourself, at least for the first 20 to 30 minutes, I will be very grateful to you. Again thank you for joining. Despite actually we have been operating in a very dynamic situation, Shell Oman Marketing continue to deliver resilient results while actually still focusing on safety, operational excellence, customer value, and sustainable growth. Let me start actually what really matters most to Shell Oman Marketing, which is safety. Safety to our people, to our contractors, partners, and the society, and the environment we work at. For the first six months, actually, the company has scored outstanding results when it comes to safety. Zero harm to people and zero process and safety leaks.

Speaker #2: So again, thank you for joining. Despite—actually, we have been operating in a very dynamic situation. Shell Oman Marketing continued to deliver resilient results while still focusing on safety, operational excellence, customer value, and sustainable growth.

Speaker #2: Let me start with what really matters most to Shell Oman Marketing, which is safety—safety for our people, our contractors, partners, the society, and the environment in which we work.

Speaker #2: For the first six months, actually, the company has scored outstanding results when it comes to safety: zero harm to people and zero process safety leaks.

Speaker #2: This, as I said, reflects the commitment and the safety culture that Shell Oman Marketing is working within. Some of the key strategic focus areas: performance, risk, and management.

Mahmoud Al Abri: This, as I said, reflects the commitment and the safety culture Shell Oman Marketing is working at. Some of the key strategic focus, performance, risk, and management. We continue to enhance our HSSE performance through different proactive measure risks and workforce engagement, as well as strengthening our operational discipline, critical control effectiveness, and a culture of continuous improvement across different line of businesses of the company. In terms of assurances and disciplines, we have completed a number of risk-based HSSE assurances across the company that actually has provided the company as well as the management with the confidence in terms of the effectiveness of the control process the company has. That has helped us to continue achieving our Goal Zero in terms of safety.

Speaker #2: We continue to enhance our HSSC performance through different proactive measures, risk management, and workforce engagement, as well as strengthening our operational discipline, critical control effectiveness, and a culture of continuous improvement across different lines of business within the company.

Speaker #2: In terms of assurances and disciplines, we have completed a number of risk-based HSSC assurances. Across the company, that actually has provided the company, as well as the management, with confidence in terms of the effectiveness of the control process the company has.

Speaker #2: And that has helped us to continue achieving our goal—zero in terms of safety. In terms of simplification and standardizations, we also continue to enhance our HSSC efficiency and operational effectiveness through simplification and standardization of key processes, as well as strengthening governance, compliance, action management, and workforce engagement.

Mahmoud Al Abri: In terms of simplification and standardizations, we also continue to enhance our HSSE efficiency and operational effectiveness through simplification and standardization of key processes as well as strengthening governance, compliance, action management, and workforce engagement. Looking ahead for the next 6 months, our priority will continue to protect our people, achieve Goal Zero, make sure we actually maintain our process safety, as well as enhance our contractor HSSE and assurances culture. As well as finally strengthening our operational discipline, emergency preparedness risk and risk management across all the line of businesses of Shell Oman Marketing. With this, actually, I will hand over to our CFO, Lamees, to take us through the financial performance for the last 6 months.

Mahmoud Al Abri: In terms of simplification and standardizations, we also continue to enhance our HSSE efficiency and operational effectiveness through simplification and standardization of key processes as well as strengthening governance, compliance, action management, and workforce engagement. Looking ahead for the next six months, our priority will continue to protect our people, achieve Goal Zero, make sure we actually maintain our process safety, as well as enhance our contractor HSSE and assurances culture. As well as finally strengthening our operational discipline, emergency preparedness risk and risk management across all the line of businesses of Shell Oman Marketing. With this, actually, I will hand over to our CFO, Lamees, to take us through the financial performance for the last six months.

Speaker #2: Looking ahead to the next six months, our priority will continue to be protecting our people, achieving Goal Zero, making sure we actually maintain our process safety, as well as enhancing our contracts—contractor HSSC and assurance culture.

Speaker #2: As well as, finally, strengthen our operational discipline, emergency preparedness, and risk management across all the lines of business of Shell Oman Marketing. With this, I will actually hand over to our CFO, Lamid, to take us through the financial performance for the last six months.

Speaker #4: Sorry. Thank you, Mahmoud, and good afternoon, everyone. Thank you for joining us today. I'm pleased to take you through a snapshot of the financial performance.

Lamees Al Lawati: Thank you, Mahmoud, and good afternoon, everyone. Thank you for joining us today. I am pleased to take you through the snapshot of the financial performance for the H1 of-

Speaker #4: For the first half of—

Speaker #2: I hope it's audible, team. Just to make sure you can hear Lamid clearly.

Mahmoud Al Abri: I hope it is audible, team. Just to make sure you hear Lamees clearly.

Speaker #4: Yes.

Speaker #3: Yes, we can. Yes, yes.

Operator: Yes.

Operator: Yes, we can. Yes.

[Company Representative] (Shell Oman Marketing): Yes, we can. Yes.

Lamees Al Lawati: Perfect. Thank you for the confirmation. Over the next 10 minutes or so, I will be taking you through the snapshot of the financial performance for the H1 of 2026. The detailed financial reports are available on the Muscat Stock Exchange website after being endorsed by the board and the audit committee towards the end of July. On a quick note, if you look at the slide in front of you would see that we continue to deliver strong, profitable results and sustainable performance, building on the promise to our shareholders to continue delivering strong results for them. When we look at the revenue for the H1 of 2026, we delivered about OMR 259 million, and that was about 9% higher than the same period last year.

Speaker #4: Perfect. Thank you for the confirmation. Over the next 10 minutes or so, I will be taking you through a snapshot of the financial performance for the first half of 2026.

Speaker #4: The detailed financial reports are available on the MSX website, after being endorsed by the board and the audit committee, towards the end of July.

Speaker #4: On a quick note, if you look at the slide in front of you, you will see that we continue to deliver strong, profitable results and sustainable performance, building on the promise to our shareholders to continue delivering strong results to them.

Speaker #4: Now, when we look at the revenue for the first half of 2026, we delivered about 259 million Omani Riyals, and that was about 9% higher than the same period last year.

Speaker #4: The 9% growth reflects overall revenue growth and volume growth across different business segments, and also, obviously, builds on our strong core customer base that we have.

Lamees Al Lawati: The 9% growth reflects overall revenue growth and volume growth across different business segments, and also obviously building on our strong core of customer base that we have. If we move to the gross profit for the period, we have delivered OMR 17.6 million. It was in line with the same gross profit that we have reported in the same period last year. If you look at the trend of the last five years, you would see that we have continued maintaining our promise to the shareholders and to the investors community of maintaining despite the pressure that, again, my colleague Mahmoud was referring to earlier in the discussion, the competitive landscape that we operate in locally, but then obviously coupled with the geopolitical tensions that we have seen, which has escalated to a great extent in H1 of this year.

Speaker #4: We mostly gross profit for the period. We have delivered 17.6 million Omani riyals. It was in line with the same gross profit that we have reported in the same period last year.

Speaker #4: And if you look at the trend over the last five years, you would see that we have continued maintaining our promise to the shareholders and to the investor community of maintaining—despite the pressure that, you might believe, Mahmoud was referring to earlier in the discussion—so, the competitive landscape that we operate in locally, but then, obviously, coupled with the geopolitical tension that we have seen, which has escalated to a great extent in the first half of this year.

Speaker #4: Now, some of our business lines are correlated with, you know, the activities that we see being impacted in logistic routes, transportation activities, as well as certain grade sourcing from outside of Oman, which has squeezed the margin for certain parts of the first half of 2026.

Lamees Al Lawati: Now some of our business lines are correlated with the activities that we see being impacted in logistic routes, transportation activities, as well as certain grade sourcing from outside of Oman, which has squeezed the margin for certain parts of H1 2026. Despite that, and building on the strong revenue growth that we have reported, we have maintained our gross profit at the OMR 17 million range, and the gross profit percentage has been maintained as well at the 7% range, which is ahead of the industry. If we look at other income, for H1 of the year, we have delivered about OMR 2.3 million in other income. Other income is basically non-core fuel activities that we have across our service stations and few other business lines as well.

Speaker #4: So, despite that, and building on the strong revenue growth that we have reported, we have maintained our gross profit in the 17 million Omani Riyals range, and the gross profit percentage has also been maintained in the 7% range.

Speaker #4: Which is ahead of the industry. If we look at other income, for the first half of the year, we have delivered about 2.3 million Omani Riyals in other income.

Speaker #4: And other income is basically from non-core fuel activities that we have across our service stations, and a few other business lines as well. So, building on the previous discussions we had, there was interest from the shareholders and the investors to understand what is in other income.

Lamees Al Lawati: Building on the previous discussions we had, there was interest from the shareholders and the investors to understand what is in other income. These are the convenience retail activities, car care center activities that we have, and other value propositions that we offer in the facilities that we have across the country. So, 3% growth in there, reflecting on our continued focus in this segment and also proving once again that other income continues to be a very strong contributor and pillar in our overall profitability. In a bit, my colleagues will be going through the detailed activities that took place, and were conducted in every line of business. Suresh, maybe you can shed light on some of the activities that happened in that space. Moving on, we continue our focus and our discipline in cost management.

Speaker #4: So these are the conventional or convenience retail activities, car care center activities that we have, and other value propositions that we offer in the facilities we have across the country.

Speaker #4: So, 3% gross in there. Reflecting on our continued focus in this segment, and also proving, once again, that other income continues to be a very strong contributor and pillar in our overall profitability.

Speaker #4: In a bit, my colleagues will be going through the detailed activities that took place and were conducted in every line of business, so maybe you can shed light on some of the activities that happened in that space.

Speaker #4: Moving on, we continue our focus and our discipline in cost management. So, despite the 9% revenue growth that we have reported, despite serving a bigger base of business, and despite inflation and the escalation indexes that we had generally across our contracts, we have maintained our cost base almost in line with the same level we have been operating with in the first half of 2025.

Lamees Al Lawati: Despite the 9% revenue growth that we have reported, despite serving a bigger base of business, and despite inflation and escalation indexes that we have generally across our contracts, we have maintained our cost base, almost in line with the same level we have been operating with in H1 2025. A lot of cost containment activities, a lot of cost optimization initiatives across our contracting activities, across our maintenance activities, and across how we conduct business in general, without obviously compromising on operational excellence as our employee well-being, which continue to be the fundamentals that are non-compromisable for our business. We look at financing costs for the period. We have actually delivered 10% lower financing costs, managing a bigger business. So we continued optimizing the working facilities and the banking facilities that we have.

Speaker #4: A lot of cost containment activities, a lot of cost optimization initiatives across our contracting activities, across our maintenance activities, and across how we conduct business in general—without, obviously, compromising on operational excellence, HSSC, or our employee well-being, which continue to be the fundamentals that are non-compromisable for our business.

Speaker #4: We look at financing costs for the period. We have actually delivered 10% lower financing costs, managing a bigger business. So we continued optimizing the working facilities and the banking facilities that we have.

Speaker #4: We put in a lot of effort to improve working capital elements in general—so improving and optimizing our collection from the market, which has given us a bit of a breather in financing costs.

Lamees Al Lawati: We put in a lot of effort to improve working capital elements in general. Improving and optimizing our collection from the market, which has given us a bit of a breather in financing costs. Overall, 10% reduction there, which is about OMR 200,000 or so in terms of absolute value. Our profit for the period was OMR 3 million, 5% growth year-on-year. Our EBIT stands at around OMR 4.8 million, but it actually has translated in higher income tax for the period. Maybe on a final note, our ROACE continues to be within the range of 10%, reflecting the continued work and focus we do to deploy capital and to manage shareholders' liquidity and cash with a lot of focus. We have been deploying cash where we think and where we believe is absolutely required for us.

Speaker #4: So overall, a 10% reduction there, which is about 200,000 or so in terms of absolute value. Our profit for the period was 3 million Omani riyals, so 5% growth year on year.

Speaker #4: Our EBIT stands at around $4.8 million, but it actually has translated into higher income after tax for the period. Maybe on a final note, our ROACE continues to be within the range of 10%, reflecting the continued work and focus we put in to deploy capital and to manage shareholders' liquidity and cash with a lot of focus.

Speaker #4: So, we have been deploying cash where we think and where we believe it is absolutely required for us, but then we've maintained our overall return on average capital employed in the range of 10%.

Lamees Al Lawati: We've maintained our overall return on average capital employed in the range of 10%. That's it in very high levels, and I'll be happy to take questions towards the end.

Speaker #4: So that's it at a very high level, and I'll be happy to take questions towards the end.

Speaker #1: Thank you. Let me now hand over to Suresh, Mobility GM. Suresh, over to you.

Mahmoud Al Abri: Thank you, Lamees. Let me now hand over to Suresh, Mobility GM. Suresh, over to you.

Speaker #5: Thank you. So, we've had a very exciting two quarters in 2026, seeing mobility volumes at our retail sites not only return but actually grow at a very exciting rate, which we have not seen over the past four to five years.

Suresh Nair: Thank you. We've had a very exciting two quarters in 2026. Seeing mobility volumes at our retail sites not only return but grow actually at very exciting rates, which we have not seen over the past four to five years. This has been mainly attributed to three factors which we are seeing internally, and two factors externally. The external factors which we are seeing contributing to this growth continues to be a healthy growth in terms of vehicle, population distribution, but also fuel consumption, in general for people's mobility needs.

Speaker #5: This has been mainly attributed to three factors, which we are seeing internally, and two factors externally. Now, the external factors which we are seeing contributing to this growth continue to be healthy growth in terms of vehicle population, population distribution, but also fuel consumption in general, for people's mobility needs.

Speaker #5: But the second one is with the current regional climate. And some of the supply chain interruptions which we saw, especially towards the end of Q1 and Q2, while inherently impacting some parts of the business, there were inorganic opportunities for us also to capitalize, with the condition that we make our supply chains more effective for fuel deliveries. Through that, we were able to capitalize on immediate opportunities which we saw, especially during the March to May period.

Suresh Nair: But the second one is with the current regional climate and some of the supply chain interruptions which we saw, especially towards the end of Q1 and Q2, while inherently impacting some parts of the business. There were inorganic opportunities for us also to capitalize, with the condition that we make our supply chains more effective for fuel deliveries. Through that, we were able to capitalize on immediate opportunities which we saw, especially during the March to May period. Now, internally, with the business, we have taken many first steps in the H1 of the year. We have introduced Shell V-Power proprietary racing fuels, and that is a 98 RON-based fuel for the first time, not only in Oman but in the Middle East. This is Shell's best grade fuel, actually recognized worldwide.

Speaker #5: Now, internally within the business, we have taken many first steps in the first half of the year. We've introduced Shell V-Power proprietary racing fuels, and that's a 98 RON-based fuel for the first time not only in Oman, but also in the Middle East.

Speaker #5: This is Shell's best-grade fuel—actually recognized worldwide. And because of the introduction of this fuel, we're noticing a lot of excitement around the whole V-Power portfolio, which we have, and it's creating a lot of excitement around that.

Suresh Nair: Because of the introduction of this fuel, we are noticing a lot of excitement around the whole V-Power portfolio, which we have, and creating a lot of excitement around that. We married this with some strategic partnerships, especially with car clubs, notably Supercar Majlis, BMW, GTR Oman, as well as a branding arrangement with the Oman Automobile Association. We would have seen the launch at the OAA. But following that, for a healthy period of 3 months, we would have seen the partnership advertisements to improve brand visibility. Again, to build people's trust and awareness, but also build people's love for the brand. We are seeing that translated to a healthy growth in our V-Power and V-Power Racing portfolio. We continue to expand our retail footprint in terms of retail sites. We expect between 2 to 4 new sites this year.

Speaker #5: We married this with some strategic partnerships, especially with car clubs— notably Supercar Majlis, BMW, and GTR Oman— as well as a branding arrangement with the Oman Automobile Association.

Speaker #5: We have seen—we would have seen—the launch at the OAA, but following that, for a healthy period of three months, we would have seen the partnership advertisements to improve brand visibility.

Speaker #5: Again, to build people's trust and awareness, but also to build people's love for the brand. And we are seeing that translate to healthy growth in our V-Power and V-Power Racing portfolio.

Speaker #5: We continue to expand our retail footprint in terms of retail sites. We expect between 2 to 4 new sites this year, expanding our Shell Helix Oil Care and Car Care Centers footprint this year, by between 6 to 8 additional sites compared to 2025.

Suresh Nair: We are expanding our Shell Helix oil care and car care centers footprint this year between 6 to 8 total additional sites as compared to 2025. This includes car washes as well. We are expanding our Shell Café locations now to over 50-plus locations, with also like a plug-in model. Which means it does not have to be a full-blown Shell Café, but it is actually done in pockets where it is smaller in terms of footprint, but yet able to serve our customer needs. For example, in terms of drive-throughs. Lastly, in the place of the energy transition, we launched during the Oman Sustainability Week, a first of its kind battery swapping solutions for e-bikes. This was a partnership with BYoD, who was the suppliers of both the bikes and the batteries, as well as Talabat, who is the delivery provider.

Speaker #5: This includes car washes as well. We are expanding our Shell Cafe locations now to over 50 locations, with also a plug-in model, which means it doesn't have to be a full-blown Shell Cafe, but it's actually done in pockets where it's smaller in terms of footprint, yet still able to serve our customer needs.

Speaker #5: For example, in terms of drive-throughs. Lastly, in the area of the energy transition, we launched during Oman Sustainability Week a first-of-its-kind battery swapping solution for e-bikes.

Speaker #5: This was a partnership with BYOD, who were the suppliers of both the bikes and the batteries, as well as Talabat, who is the delivery provider.

Speaker #5: Today, you'll see on the road anywhere between 20 to 30 delivery bikes, and this will be expanded over the alternate in the next year or so up to 1,200 bikes, which ultimately ride around with their charged battery, proceed to a Shell station where they can swap the battery out and proceed on to their delivery journey. Both making their logistics more efficient, but more importantly, reducing the cost of operation and also the carbon footprint.

Suresh Nair: Today, you will see on the road anywhere between 20 to 30 delivery bikes, and this will be expanded over the alternate in the next year or so up to 1,200 bikes. Which ultimately ride around with their charged battery, proceed to a Shell station to where they can swap this battery out and proceed on to their delivery journey. Both making their logistics more efficient, but more importantly, reducing the cost of operation, but also the carbon footprint. We are looking further to expand such partnerships in the B2B space to look for e-mobility opportunities, in that segment. As well as seeing what inorganic growth areas we can pursue as a company in the energy transition. In the closing, we are expecting a very vibrant H2 of the year with all of Oman's macroeconomic indicators pointing us in the right direction for the retail segment.

Speaker #5: We are looking further to expand such partnerships in the B2B space, to look for e-mobility opportunities in that segment, as well as seeing what inorganic growth areas we can pursue as a company in the energy transition.

Speaker #5: In closing, we're expecting a very vibrant second half of the year, with all of Oman's macroeconomic indicators pointing us in the right direction for the retail segment.

Speaker #5: We are expecting a lot of further headwinds as a result of the regional crisis which is happening, but as an organization, we've also built a stronger learning muscle in terms of not only how we withstand and grow during this difficult period, but really thrive. And that's our aim—to thrive in the second half of this year.

Suresh Nair: We are expecting a lot of further headwinds as a result of the regional crisis, which is happening. But as an organization, we have also built a stronger learning muscle in terms of not only how we withstand and grow during this difficult period, but really thrive, and that is our aim, to thrive in the H2 of this year. With that, I will pass back to Mahmoud for the next business.

Speaker #5: With that, I'll pass back to Mahmoud for the next business.

Speaker #2: Thank you, Suresh. Let me move to Hamed Fatosali, Loops GM.

Mahmoud Al Abri: Thank you, Suresh. Let me move to Mohamed ElFatatry, lubes GM. Mohammed?

Speaker #4: Sure, good morning, everyone. So for lubricants, definitely Q2 was quite an exciting quarter. There were lots of disruptions in terms of logistics outlook, and that is now seen to continue.

Mohamed ElFatatry: Good morning, everyone. For lubricants, definitely Q2 was quite an exciting quarter. Lots of disruptions in terms of the logistics outlook, and that is now seen to continue. However, the good news is we have been able to show great resilience around the business from the manufacturing standpoint, but also in terms of the changes of the structure of the supply chain and the routing. So far, we have been able to entertain and fulfill most of the local demand, including the premium, which is quite constrained as well. On top of that, we have been able to sustain our exports in the Middle East region, with some volumes also flowing to India, Saudi Arabia, and the Egyptian market. On the local front, I think we have been also able to make quite improvements in the digital channel.

Speaker #4: However, the good news is, we've been able to show great resilience around the business from the manufacturing standpoint, despite changes in the structure of the supply chain and the routing.

Speaker #4: So far, we've been able to entertain and fulfill most of the local demand, including the premium, which is quite constrained as well. On top of that, we've been able to sustain our exports in the Middle East region, with some volumes also flowing to India, Saudi Arabia, and the Egyptian market.

Speaker #4: On the local front, I think we've also been able to make quite a few improvements in the digital channel, which is the Shell Share app, targeting trade B2C customers around lubricants.

Mohamed ElFatatry: Which is the Shell Advantage Rewards app, which is targeting trade B2C customers around lubricants. In the H1 of the year, we have actually overachieved, and we have crossed past the total 2025 volume that was transacted on Shell App. In terms of customer operations, we have been also able to continue the digitization journey. We have also migrated some of our systems to Microsoft platforms, which is also driving more efficiency, cost improvements, but also enhanced customer experience. In terms of the outlook, expected outlook for lubricant supply chain has remained to be constrained, especially on the Group III base oils, which are premium grades. With also the latest news around the Bab el-Mandab being closed, logistic routes remain to be, again, challenged.

Speaker #4: So, in the first half of the year, we have actually overachieved and we have surpassed the total 2025 volume that was transacted on the Shell app.

Speaker #4: In terms of customer operations, we've also been able to continue the digitization journey. We've migrated some of our systems to Microsoft platforms, which is driving more efficiency, cost improvements, and an enhanced customer experience.

Speaker #4: In terms of the outlook, the expected outlook for the lubricant supply chain is to remain constrained, especially for the Group 3-based oils, which are premium grades.

Speaker #4: With also the latest news around the Bab al-Mandab being closed, logistic routes remain to be again challenged. And I think now on probably weekly basis, we are in exploration of new routes whether by road or by sea or by air freight.

Mohamed ElFatatry: I think now on probably weekly basis, we are in exploration of new routes, whether by road or by sea or by air freight. This current challenge is also opening lots of opportunities, in terms of potential new markets for exports, in terms of also sourcing, and most importantly as well, formulations of products. I would say to sum it up, it has been quite exciting. We are showing lots of resilience. There is a lot of brainstorming and solution development on the table at the moment. Some of these have realized, and we are actually enjoying the outcomes of these in Q2 and Q3. There are lots of ideas to stay tuned and look forward to. Thank you.

Speaker #4: But also, this current challenge is opening lots of opportunities—in terms of potential new markets for exports, in terms of sourcing, and most importantly, in the formulation of products.

Speaker #4: So, I would say, to sum it up, it's been quite exciting. We're showing lots of resilience. There is a lot of brainstorming and solution development on the table at the moment.

Speaker #4: Some of these have materialized, and we are actually enjoying the outcomes of these in Q2 and Q3. But also, there are lots of ideas, so stay tuned and look forward to them.

Speaker #4: Thank you.

Speaker #2: Thank you, Hamed. Let me move now to carbon solutions, Ahmed.

Mahmoud Al Abri: Thank you, Mohammed. Now to the low carbon solutions, Ahmed.

Speaker #5: Thank you, Mahmoud. Good afternoon, everyone. Happy to take you through the low carbon solution highlights. Starting with the HSC—Alhamdulillah, we achieved exceptional HSC performance.

[Company Representative] (Shell Oman Marketing): Thank you, Mahmoud. Good afternoon, everyone. Happy to take you through the low carbon solution highlights. Starting with the HSSE. Alhamdulillah, we achieved exceptional HSSE performance with zero fatality, zero leak, zero significant incident, demonstrating our strong commitment to HSSE and operation excellence. Moving to the aviation and marine fuel and lube businesses, demonstrating high resilience and agility despite the ongoing conflict on the region. For the aviation specifically, we maintain the jet fuel supply in both locations, Muscat and Salalah, for our domestic and international airlines. In addition to securing new contracts with our international airline visiting Muscat and Salalah with the help of our global operation. Moving to the marine and commercial fuel segment, we retained a number of contracts, key B2B customers from both government and private sectors.

Speaker #5: With zero fatality, zero loss time incident, zero significant incident—demonstrating our strong commitment to HSE operational excellence. Moving to the aviation and marine fuel and lubes businesses, they're demonstrating high resilience.

Speaker #5: And ongoing conflict in the region. For aviation specifically, we maintain the jet fuel supply in both locations, Muscat and Salalah, for our domestic and international airlines.

Speaker #5: In addition to securing new contracts with our international airlines visiting Muscat and Salalah, with the help of our global operations, we are moving into the marine and commercial fuel segments.

Speaker #5: We retain a number of contract B2B customers from both government and private sectors. In addition to that, we are signing multiple contracts with new and old, as well as customers from B2C, from government and private customers.

[Company Representative] (Shell Oman Marketing): In addition to that, we have signed multiple contracts with new and old as well customers from B2C as well, government and private customers. In addition to that, also we are enhancing our volume growth with our current local SMEs, resellers for both commercial and marine streets. Going forward, we are continuing our focus on Goal Zero, the efficient compliance, our operation excellence. In addition to giving special focus on optimizing our profitability core, exploring new business opportunity for operation and finance opportunities. Growing our profitability through strengthening our future pipeline and looking for new contracts, in addition to ensuring the cross-business synergy within some different businesses. That is all from my end, actually.

Speaker #5: In addition to that, we are certainly enhancing our volume growth with our current local SMEs and resellers, for both commercial and marine fuels. Going forward, we are continuing our focus on Goal Zero.

Speaker #5: The efficient compliance, our operational excellence. and in addition to giving special focus on optimizing our profitability core, exploring new business opportunities for operation and finance opportunities.

Speaker #5: Growing our profitability through strengthening our future pipeline and looking for new contracts, in addition to ensuring cross-business synergy within some different businesses. That's all from my end, actually.

Speaker #2: Thank you, Ahmed. And before we actually conclude our business performance section, let me take you through our corporate social responsibility. Our long-term success goes hand in hand with what we are actually providing in support of the local community.

Mahmoud Al Abri: Thank you, Ahmed. Before actually we conclude our business performance, let me take you through our corporate social responsibility. Our long-term success goes hand in hand with what we actually providing, supporting the local community. Our CSR strategy remain focused on three areas, which is environment, health, and community skills and enterprise development. This is in alignment with the needs of the communities in Oman as well as with Oman Vision 2040. Some of the key highlights, empowered Omani entrepreneurs. So recently, through the program of Shell Her Way, we provided different skills development, business support, and market access and opportunities to those young women through some selected Shell Select stores across Oman. In terms of supporting SMEs, through a collaboration with the Oman Chamber of Commerce and Industry, we offer visibility and retail growth opportunity to also some of the Omani SMEs.

Speaker #2: Our CSR strategy remains focused on three areas, which are environment, health, and community skills and enterprise development. This is in alignment with the needs of the communities in Oman, as well as with Oman Vision 2040.

Speaker #2: Some of the key highlights empowered Omani entrepreneurs. So recently, through the program Shell Helper, we provided different skills development, business support, and market access opportunities to those young women through some selected Shell Select stores across Oman.

Speaker #2: In terms of supporting SMEs, through a collaboration with the Oman Chamber of Commerce and Industry, we offer visibility and retail growth opportunities to some of the Omani SMEs as well.

Speaker #2: In terms of supporting future talent, we actually sponsored and supported students from the German University recently for them to participate in the Shell.

Mahmoud Al Abri: In terms of supporting future talent, we actually sponsored and support students from the German University of Technology in Oman recently for them to participate in the Shell Eco-marathon. This is to spread the sustainability awareness and encourage innovation. In terms of youth development, we just concluded a three-year sponsorship with the Outward Bound Oman, contributing to youth development and sustainability-focused skills training with over 11,500 participants across Oman and across the last three years. In terms of community engagement, also in terms of health engagement, we actually, this second year, we are working with the Ministry of Health to support the National Community Nursing Program, again, to spread the health services across Oman. In terms of community engagement, we delivered a number of safety awareness initiatives, including HSSE and first aid education also across different cities in Oman.

Speaker #2: This is to spread sustainability awareness and encourage innovation. In terms of youth development, we just concluded a three-year partnership with Outward Bound Oman.

Speaker #2: Contributing youth development and sustainability focused skills training. With over 11,500 participants across Oman and across the last three years. In terms of community engagement, sorry, in terms of health engagement, we actually this is the second year we're working with the Ministry of Health to support the national community nursing program again to spread the health services across Oman.

Speaker #2: In terms of community engagement, we delivered a number of safety awareness initiatives, including HSSC and first aid education, also across different cities in Oman.

Speaker #2: Looking ahead to the plans for the second half of the year, we will continue to focus on sustainable and long-term social impact. Across different regions in Oman, we will strengthen and maximize our various partnerships.

Mahmoud Al Abri: Looking for the plans and for the H2 of the year, we will continue to focus on sustainable and long-term social impact across different regions in Oman. We will strengthen and maximize our different partnerships, and we will further incorporate our integrity values through all the CSR activity across all the company supply chain through strategic long-term steps and plans. I think with this, we have come to the end of our business performance presentation. Now is the time for Q&A. So what I really recommend, you can unmute yourself, say your name, which institutions or firm you represent, and you can ask your question. Second option, you can also write your question in the chat box. Can you hear me? Still stuck.

Speaker #2: And we will further incorporate our intended value through all the CSR activity across all the company's supply chain, through strategic long-term steps and plans.

Speaker #2: I think with this, we have come to the end of our business performance presentation. Now it's time for Q&A. So what I really recommend is that you unmute yourself, say your name, which institution or firm you represent, and you can ask your question.

Speaker #2: Second option: You can also write your question in the chat box. Can you hear me?

Speaker #3: So you're audible, but whoever needs to ask a question can just go on and unmute themselves.

Lamees Al Lawati: You are audible, but whoever needs to ask a question can just go on unmute themselves.

Speaker #5: Can you hear me?

Speaker #2: Option.

Shaw Amir Ali: Can you hear me?

Rao Aamir Ali: Can you hear me?

Mahmoud Al Abri: Option. Oops, sorry. Yes, we hear you. Can you please say your name and your?

Speaker #5: Yes, we hear you. Can you please say your name and your language?

Speaker #4: Yes, yes. My name is Shaw Amirali, and I am a research analyst at Ubahar Capital. I have a couple of questions, if you allow me.

Shaw Amir Ali: Yes

Rao Aamir Ali: Yes

Mahmoud Al Abri: company?

Shaw Amir Ali: Yes. My name is Shaw Amir Ali, and I am a research analyst at U Capital. I have a couple of questions, if you allow me.

Rao Aamir Ali: Yes. My name is Shaw Amir Ali, and I am a research analyst at U Capital. I have a couple of questions, if you allow me.

Speaker #5: Go ahead.

Speaker #4: So, what is the total sales of MS for Shell in Oman? It's in volumetric terms.

Mahmoud Al Abri: Go ahead.

Shaw Amir Ali: What is the total sales of MS of Shell in Oman, in volumetric terms?

Rao Aamir Ali: What is the total sales of MS of Shell in Oman, in volumetric terms?

Speaker #5: We talk about total MS sales. Can you elaborate?

Mahmoud Al Abri: You talk about total MS sales?

Speaker #4: Yes, yes. Total MS sales.

Shaw Amir Ali: Yes.

Rao Aamir Ali: Yes.

Mahmoud Al Abri: Can you elaborate?

Speaker #5: Can you elaborate more?

Shaw Amir Ali: Yes. Total MS sales.

Rao Aamir Ali: Yes. Total MS sales.

Speaker #4: In volumetric terms, what is the total sales on an annual basis or on a half-year basis, if you can tell?

Mahmoud Al Abri: Can you elaborate more?

Shaw Amir Ali: In volumetric term, what is the total sales on annual basis or on H1 basis, if you tell that?

Rao Aamir Ali: In volumetric term, what is the total sales on annual basis or on H1 basis, if you tell that?

Speaker #5: Talk about fuel, or... I don't know. Or something different.

Mahmoud Al Abri: You talk about fuel or, I do not know, or different?

Speaker #3: So, we generally don't disclose volume numbers in our financial statements, but just for reference, it's above for year-to-date for the first half of the year.

Lamees Al Lawati: We generally do not disclose volume numbers in our financial statements. But just for reference, it is above, for YTD, for the first half of the year, it has been above 1 billion liters for the combined business, including fuels and lubricants.

Speaker #3: It has been above 1 billion liters for the combined business, including fuels and lubricants.

Speaker #4: Okay. If you can share only the share, what is the total shares in Oman in percentage terms? If you know, what is the disclosed volume?

Shaw Amir Ali: Okay. If you can share only the share. What is the total shares in Oman in percentage term, if you don't want to disclose the volume?

Rao Aamir Ali: Okay. If you can share only the share. What is the total shares in Oman in percentage term, if you don't want to disclose the volume?

Speaker #3: Yeah, so I think because of the small market size, the market consists of three oil marketing companies, and I think this information is not publicly available.

Lamees Al Lawati: Yeah. I think because of the small market size and the market is consisting of three oil marketing companies, and I think this information is not publicly available. It could be available for certain product grades, but it is not exactly on a like-to-like comparison across the different business segments. This information is not publicly available at the moment, which makes it difficult to refer to a specific percentage.

Speaker #3: It could be available for certain product grades, but it's not exactly an apples-to-apples comparison across the different business segments. So, this information is not publicly available at the moment, which makes it difficult to refer to a specific percentage.

Speaker #4: Okay, okay. No, no, no problem.

Shaw Amir Ali: Okay. No problem.

Rao Aamir Ali: Okay. No problem.

Speaker #3: Yeah.

Lamees Al Lawati: Confidential. It is close-held information. Yeah.

Speaker #4: Okay, okay. Correct me if I'm wrong, but the dealer margin is 7.5 per liter and the OMC margin is 6 per liter on petrol and diesel.

Shaw Amir Ali: Okay. Correct me if I am wrong. Dealer margin is 7.5 baisa per liter and OMC margin is 6 baisa per liter on petrol and diesel. I want to know what is the actual total subsidy at current prices? If prices are hovering around $100 per barrel, what will be the subsidy like? Because the prices in Oman are fixed. If 239 baisa per liter price is charged for petrol, including subsidy, what will be the total price of petrol?

Rao Aamir Ali: Okay. Correct me if I am wrong. Dealer margin is 7.5 baisa per liter and OMC margin is 6 baisa per liter on petrol and diesel. I want to know what is the actual total subsidy at current prices? If prices are hovering around $100 per barrel, what will be the subsidy like? Because the prices in Oman are fixed. If 239 baisa per liter price is charged for petrol, including subsidy, what will be the total price of petrol?

Speaker #4: So, I want to know: what is the actual total subsidy at current prices? Like, if prices are hovering around $100 per barrel, what will the subsidy be?

Speaker #4: Because the prices in Oman are fixed, if a price of 239 per liter is charged for petrol, including the subsidy, what will be the total price of petrol?

Speaker #3: I think it really varies depending on the product type that we are talking about. So if you go to a filling station, across the different product grades, the pricing usually varies between 299. I mean, every oil marketing company would follow the government direction, except for differentiated fuels.

Lamees Al Lawati: I think it really varies depending on the product type that we are talking about. If you go to a filling station and across the different product grades, the pricing usually varies between 299 baisa. I mean, every oil marketing company will follow the government direction except for differentiated fuels. The product range would be, or the pricing range would be in the range of 300 baisa to below that. The composition of margin structure that you have shared is largely correct, as it's not 7.5 baisa and 6 baisa. It's 6.5 baisa for the fuel marketing company, and it's 7 baisa for the operator. Combined together, they are 13.5 baisa per liter that gets retained across the value chain between the operator and the fuel marketing company.

Speaker #3: So, the product range would be, or the pricing range would be, in the range of 300 or below that. The composition of the margin structure that you have shared is largely correct.

Speaker #3: So it's not 7.5 and 6. It's 6.5 for the fuel marketing company, and it's 7 for the operator. So combined together, there are 13.5 per liter that gets retained across the value chain between the operator and the fuel marketing company.

Speaker #3: Now, you can do the math depending on the product grade that you are looking at. Any upside goes to the government. And the specific question about subsidy is honestly a question to be asked to the government.

Lamees Al Lawati: You can make the math depending on the product grade that you are looking at. Any upside goes to the government. The specific question about subsidy is honestly a question to be asked to the government. We are not in a position to answer that. We can only refer to the market, to the margin composition that is controlled by us or sort of given to us. Any upside between the pump price and the margin structure is actually with the government, and the government gets to decide how much of that is the actual production cost and how much of that is free subsidy?

Speaker #3: So, we are not in a position to answer that. We can only refer to the market— to the margin composition that is controlled by us, or to be given to us.

Speaker #3: Any upside between the pump price and the margin structure is actually with the government. The government gets to decide how much of that is the actual production cost and how much of that is to be subsidized.

Speaker #2: So, in Oman, generally, all the OMC companies are buying the products from the government?

Shaw Amir Ali: In Oman, generally, all the OMCs companies are buying the products from the government?

Rao Aamir Ali: In Oman, generally, all the OMCs companies are buying the products from the government?

Speaker #3: Yes. As far as we are aware, yes. For fuels, yes. So for fuels in the business space, there could be some other B2B contracts that also supply fuel.

Lamees Al Lawati: Yes. As far as we are aware, yes. For fuels, yes.

Shaw Amir Ali: Okay, in case.

Rao Aamir Ali: Okay, in case.

Lamees Al Lawati: For fuels in the B2C space, there could be some other B2B contracts that also supply fuel. But we are not aware about the different product sources for these B2B products.

Speaker #3: But we're not aware of the different product sources for these B2B products.

Speaker #2: Sorry, I was asking this question because in BAV, I was seeing the fiscal data for Oman—the subsidy for oil products has increased significantly during the May reported number.

Shaw Amir Ali: Of course. Sorry, I was asking this question because in May, I was seeing the fiscal data for Oman. The subsidy for oil prices increased significantly during the May reported number because the prices in May were high. That is why I was asking what is the structure, like how the final product prices is determined in Oman based on the crude prices. Okay. My second question is about lubricant business. What are the gross margin on these products? If you can tell, what is the total percentage in sales of Shell for this product? If you can tell.

Rao Aamir Ali: Of course. Sorry, I was asking this question because in May, I was seeing the fiscal data for Oman. The subsidy for oil prices increased significantly during the May reported number because the prices in May were high. That is why I was asking what is the structure, like how the final product prices is determined in Oman based on the crude prices. Okay. My second question is about lubricant business. What are the gross margin on these products? If you can tell, what is the total percentage in sales of Shell for this product? If you can tell.

Speaker #2: So because the prices in May was high, so just was that's why I am asking I was asking what is the structure like how the final product prices is determined in Oman.

Speaker #2: Based on the crude prices. So, okay. My second question is about the lubricant business. What are the gross, like, margins on these products?

Speaker #2: And if you can, tell us what is the total percentage in sales of Shell for this product, if you can share that.

Speaker #5: Can you repeat the first question, please?

Mohamed ElFatatry: Can you repeat the first question, please?

Speaker #2: My question is related to lubricants. What are the margins on lubricants, and what is their percentage contribution to total sales? You can tell.

Shaw Amir Ali: My question is related to the lubricants. What are the margins on the lubricants and what is the percentage contribution in total sales? If you can tell.

Rao Aamir Ali: My question is related to the lubricants. What are the margins on the lubricants and what is the percentage contribution in total sales? If you can tell.

Speaker #5: Okay. On the margin, we cannot disclose margins of a specific product or category, as the CFO has mentioned. So, if you have a specific question or indication that you're looking for, maybe you can specify the question.

Mohamed ElFatatry: Okay, on the margin, we cannot disclose margins of specific products or category as CFO has mentioned. I see if you are after, if there is a specific question or indication that you are looking for, maybe you can specify the question.

Speaker #2: In general, what are the gross margins? Like in the other products, the prices are fixed. The margins are fixed in terms of liter. But in lubricant, if you can tell us the range—between 20 to 30 percent.

Shaw Amir Ali: In general, what is the gross margins like in the other products, the prices are fixed, the margins are fixed in term of liter. But in lubricant, if you can tell us the range between 20% to 30%. Normally, the margin on the lubricants ranges between 20% to 30%. I am talking about the gross margins. If you can tell me the range, that is okay. Is it 25%, 30%, 20% to 30%?

Rao Aamir Ali: In general, what is the gross margins like in the other products, the prices are fixed, the margins are fixed in term of liter. But in lubricant, if you can tell us the range between 20% to 30%. Normally, the margin on the lubricants ranges between 20% to 30%. I am talking about the gross margins. If you can tell me the range, that is okay. Is it 25%, 30%, 20% to 30%?

Speaker #2: Normally, the margin on the lubricants ranges between 20 to 30 percent. I am talking about the gross margins. If you can tell us the range, that's okay.

Speaker #2: It's 25–30 percent, 20 to 30 percent.

Speaker #5: Yeah. We cannot disclose that.

Mohamed ElFatatry: Yeah, we cannot disclose that. Sorry.

Speaker #2: Okay. And what are the shares in total sales?

Shaw Amir Ali: Okay. What are the shares in total sales?

Rao Aamir Ali: Okay. What are the shares in total sales?

Speaker #5: Volume you mean?

Speaker #2: Yes. Yes.

Mohamed ElFatatry: Volume you mean?

Speaker #5: And in terms of volume contribution, we're talking about on the range of we're less than 5 percent. So we're talking in the range of 1 to 3 percent versus the total company volume.

Shaw Amir Ali: Yes.

Rao Aamir Ali: Yes.

Mohamed ElFatatry: In terms of volume contribution, we are talking about on the range of less than 5%. So we are talking in the range of 1% to 3% versus the total company volume.

Speaker #2: Thank you. Thank you for the answer. Thank you.

Speaker #5: Thank you. Thank you. Do we have other participants as well? I would like to ask: Can you hear me, team?

Shaw Amir Ali: Thank you. Thank you for the answers. Thank you.

Rao Aamir Ali: Thank you. Thank you for the answers. Thank you.

Mahmoud Al Abri: Thank you. Do we have other participants as well who would like to ask? Can you hear me, team?

Speaker #2: Yes, we can.

Speaker #5: Any more questions? No more questions? I think there are no more questions. I think we can check.

Shaw Amir Ali: Yes, we can hear.

[Company Representative] (Shell Oman Marketing): Yes, we can hear.

Mahmoud Al Abri: Any more questions? No more questions? I think there is no more question. I think we can

Speaker #3: Maybe we check.

Lamees Al Lawati: Check. Maybe we check.

Speaker #5: I mean, there is another option as well. You can type your question in the chat box, or just simply unmute yourself. Yes, go ahead.

Mahmoud Al Abri: There is another option as well. You can type your question in the chat box or just simply unmute yourself. Yes, go ahead.

Speaker #5: Yeah, there was a question: Could you please share your thoughts on the margins during the quarter and going forward? So, DB are talking about which quarter specifically?

Shaw Amir Ali: Yeah, there was a question from, could you please share your thoughts on the margins during the quarter and going forward?

Mohamed ElFatatry: Yeah, there was a question from, could you please share your thoughts on the margins during the quarter and going forward?

Mahmoud Al Abri: Deepak will talk about which quarter specifically, because today we have actually took you through the last six months financial performance.

Speaker #5: Because today, we have actually taken you through the last six months' financial performance.

Speaker #3: I think maybe we can just give a general question instead of one specific to the quarter. Maybe— I see Deepak typing "the second quarter" behind.

Lamees Al Lawati: I think maybe we can just give a general question instead of specific to quarter maybe. I see Deepak typing the Q2.

Speaker #3: And building on what my colleague Mohammed Al-Farasi mentioned earlier, the second quarter was not really the norm for what we usually would expect in terms of business performance, given the impact on certain business lines.

Mahmoud Al Abri: Oh, Q2.

Lamees Al Lawati: behind. Building on what my colleague Mohammed Al Balushi mentioned earlier, the Q2 was not really the norm for what we usually would expect in terms of business performance given the impact on certain business lines. That is where we said that the business resilience was actually tested during the H1 and despite all the headwinds that we have seen and we went through, yet our business performance was consistent and we actually managed to deliver growth versus last year. The margin performance typically would be influenced by two factors. The number of contracts that you have, the composition and the type of contracts that you would have in your portfolio as well as the different business lines. For majority of our B2C business, the margins are fixed and are constructed by the government.

Speaker #3: Now, and that's where we said that the business resilience is actually tested during the first half. And despite all the headwinds that we have seen and we went through, yet our business performance was consistent, and we actually managed to deliver growth versus last year.

Speaker #3: The margin performance typically would be influenced by two factors: the number of contracts that you have—the composition and the type of contracts that you have in your portfolio—as well as the different business lines.

Speaker #3: So for the majority of our B2C business, the margins are fixed and are set by the government. For B2B, depending again on the composition of contracts that you have in the different business lines...

Lamees Al Lawati: For B2B, depending on, again, the composition of contracts that you have in the different business lines. In the Q2, particularly, Deepak, we have seen a dip in volumes in aviation and in marine impacted by the overall impact we have seen in country and in the region on tourism and travel activities. As you can imagine, the aviation business sector operates in a different margin structure than us. Depending on the volume performance at any point in time, you would see that swing in the gross profit overall performance and the profitability.

Speaker #3: In the second quarter, particularly Q2, we have seen a dip in volumes in aviation and in marine. This was impacted by the overall effect we have seen in the country and in the region on tourism and travel activities.

Speaker #3: And as you can imagine, the aviation business sector operates with a different margin structure than the rest. So, depending on the volume performance at any point in time, you would see that swing in the gross profit, overall performance, and the profitability.

Speaker #3: Lubricants is another business that got quite impacted by the pressure that we have seen in the geopolitical tension that we have seen regionally. Because as I mentioned earlier, part of our products get sourced from outside of the country, so they don't follow the usual product regime that we see in the fuel space.

Lamees Al Lawati: Lubricants is another business that got quite impacted by the pressure that we have seen and the geopolitical tension that we have seen regionally, because as I mentioned earlier, part of our products get sourced from outside of the country, so they do not follow the usual product regime that we see in the fuel space, particularly for base oil and additives that we procure from different parts of the world. Depending on how the situation will ease, at the moment, we are confident about our business performance for the H2 of the year, looking at the volume forecast and looking at the stability of the situation. But the actual overall full-year performance would be dependent on all of these factors together combined.

Speaker #3: Particularly for base oil and additives that we procure from different parts of the world. So, depending on how the situation will ease at the moment, we are confident about our business performance for the second half of the year, looking at the volume forecast and looking at the stability of the situation.

Speaker #3: But the actual overall full-year performance will depend on all of these factors combined: the overall demand in the market, the number of contracts, and then the margin and the pressure that we would see from outside of the country.

Lamees Al Lawati: The overall demand in the market, the number of contracts, and then the margin and the pressure that we would see from all parts of the country.

Speaker #5: And if I may just add a little bit on the lubricants side as well, I think this is an integrated business. So there have been actions on both sides of the value chain.

Mohamed ElFatatry: If I may just add a little bit on the lubricants side as well. This is an integrated business, so there have been actions on both sides of the value chain. From a sourcing perspective, there are controllables and uncontrollables. However, from the end of the value chain also, we have been having lots of commercial interventions in terms of the pricing across sectors. Whether it is industrial lubricants or consumer lubricants. There have been certain interventions that, to a big extent, have managed the damage or the cost impact that we have been dealing with. Now, the question is: Are these addressing all of it? It is not a firm yes or no, because again, addressing such price structures takes time, and it is based on contractual obligations and liabilities. Some contracts are fixed, some contracts are formula. But again, there is no one answer.

Speaker #5: So from a sourcing perspective, there are controllables and uncontrollables. However, from the end of the value chain as well, we've been having lots of commercial interventions in terms of the pricing.

Speaker #5: Across sectors, whether it's industrial lubricants or consumer lubricants, there have been certain interventions that, to a large extent, have managed the damage or the cost impact that we've been dealing with.

Speaker #5: Now, the question is: are these addressing all of it? It's not a firm yes or no, because again, addressing such price structures takes time.

Speaker #5: And it's based on contractual obligations and liabilities. Some contracts are fixed, and some contracts are formula-based. But again, there is no one answer.

Speaker #5: However, what I can say is that interventions have been made, and overall Q2 has been lower than Q1. However, the trajectory is looking a lot more steady.

Mohamed ElFatatry: However, what I can say is interventions have been made, and overall Q2 has been lower than Q1. However, the trajectory is looking a lot more steady.

Speaker #2: Oh, Mohammed, I understand. Eric Lee, you have a question, but maybe we could not hear you. You can definitely write it in the chat box as well.

Mahmoud Al Abri: Cool. Let me jump in. I understand, Eric, you have a question, but maybe we could not hear you. You can definitely write it in the chat box as well. Any other questions? If there is no more question, we can come to an end. What do you think? Great. Thank you again for joining our investor relations sessions for the year, and looking forward to see you again.

Speaker #2: Any other questions?

Speaker #5: If there are no more questions, we can come to an end. What do you think? Thank you again for joining our investor relations session.

Speaker #5: And looking forward to seeing you again.

Speaker #3: Thank you.

Mohamed ElFatatry: Thank you.

Browse all earnings call transcripts

Half Year 2026 Shell Oman Marketing Co SAOG Earnings Call

Request TrialDemo

Shell Oman

Earnings