Saudi industrials’ earnings split as war disruption meets cost control and one-off gains

The war’s disruption ran through Saudi industrials’ latest earnings — collapsing phosphate margins at Maaden, and Gulf rig suspensions at Ades and Arabian Drilling — while cost control and one-offs like KEC’s land sale and ins. proceeds cushioned the blow across an uneven quarter.

Maaden’s margins buckle under phosphate costs

Saudi Arabian Mining’s (Maaden) bottom line shrank in 3Q 2026 even as two of its three business units posted record results, with a collapse in phosphate margins outweighing record performances in aluminum and gold. Net income fell 23.7% y-o-y to SAR 1.7 bn while revenue rose 11.3% y-o-y to SAR 11.1 bn, the company said in a Tadawul filing and earnings release (pdf).

Where the margin went: Phosphate EBITDA plummeted 83% y-o-y to SAR 507 mn, dragging the segment’s margin to 10% from 52% a year earlier even as realized diammonium phosphate (DAP) prices rose 15% to USD 893 a tonne. The damage came from higher costs and lost sales: record sulfur input costs, higher logistics costs, and the absence of ammonia export sales, with ammonia production down 49% y-o-y. DAP output recovered to 1.6 mn tonnes, up 33% q-o-q, as the sulfur shortages that hit 2Q eased.

The records underneath: Aluminum delivered its second straight record quarter, with EBITDA up 108% y-o-y to SAR 1.6 bn and its EBITDA margin widening to 43% from 27%, carried by a 41% jump in realized aluminum prices to USD 3.7k per tonne. Gold and growth metals booked what Maaden called a record performance excluding exploration spend, with EBITDA up 71% to SAR 1.5 bn, with both levers firing — realized prices up 22% to USD 4.3k per ounce and production up 22% to 139k ounces. Together, aluminum and gold generated roughly SAR 3.1 bn of quarterly EBITDA against phosphate’s SAR 0.5 bn, a near-complete inversion from a year ago when phosphate alone generated SAR 2.9 bn.

The nine-month view is far gentler: Across 9M 2026, net income slipped just 3.2% y-o-y to SAR 5.5 bn, cushioned by SAR 375 mn in one-off ins. proceeds in the phosphate unit, while revenue rose 10.5% to SAR 30.9 bn.

Capex comes down, export disruption drags on: CEO Bob Wilt said Maaden's phosphate team had “responded to a complex situation and restored granulated production to levels comparable to last year.” Yet the company cut total capex guidance by USD 1 bn from the USD 4.15 bn flagged in February and kept full-year ammonia guidance withdrawn.

Three commodities, three different outlooks: DAP production guidance remains at 6-6.5 mn tonnes, with Chinese export restrictions remaining in place longer than expected and record input costs underpinning prices. The aluminum market is heading into a supply deficit of around 800k tonnes in 4Q, but is expected to rebalance in 2027. Gold production is tracking toward the upper end of its 470k-515k oz guidance range, with all-in sustaining costs expected to come in below the USD 1.38k-1.5k per oz guide. Phosphate, meanwhile, hinges on sulfur costs and the resumption of ammonia exports.

Bigger fleet, smaller margins

Ades Holding’s expanded operations abroad boosted revenue in 3Q, but Gulf rig suspensions and rising costs more than halved its bottom line. Net income fell 55.8% y-o-y to SAR 94.9 mn as revenue jumped 34.8% to SAR 2.23 bn, according to a Tadawul filing. Costs grew faster than revenue: gross income rose 16.4% to SAR 704.5 mn, while operating income edged up 3.2% to SAR 514 mn.

What’s weighing on the bottom line? Some of Ades’ Saudi offshore rigs were suspended at the end of 1Q amid the regional conflict, and the suspensions were still dragging on results in 3Q, according to the company’s earnings release (pdf). Higher depreciation and interest expenses and one-off ins. costs added to the hit. Ades has since received resumption notices for all the suspended rigs, but “subsequent regional developments” have slowed their return to full operations, the company said.

International growth is carrying the top line. Revenue growth came from the rigs Ades took over from Shelf Drilling last year and higher contributions from its mature-field production business in Egypt. Saipem’s shallow-water drilling unit also made its first contribution after the SAR 1.07 bn acquisition closed in mid-September.

Nine-month results show the same pressure. Net income declined 23% y-o-y to SAR 459.8 mn despite a 44% rise in revenue to SAR 6.77 bn on growth outside Saudi Arabia, where revenue fell 13.1%. Gross income grew 29.2% to SAR 2.31 bn, and operating income increased 17.9% to SAR 1.72 bn. The company blamed the weaker bottom line mainly on the temporary rig suspensions and on the Shelf Drilling rigs it acquired, which earn thinner margins than its original fleet. One-off ins. expenses added to the pressure, while a one-off gain from buying Saipem’s rigs below their assessed value partly offset it.

More work lined up in India: Ades secured two three-year contracts worth a combined SAR 439.6 mn, including mobilization fees, from India’s Oil and Natural Gas Corporation for its Key Singapore and Admarine 10 offshore jack-up rigs, according to a separate disclosure (pdf). The rigs are expected to complete their existing contracts by the end of 4Q 2026, with work under the new agreements scheduled to begin by the end of 1Q 2027. Revenue from India more than doubled to SAR 426 mn in 9M 2026 as Shelf rigs joined the fleet there, according to the earnings release.

Back in the black

Arabian Drilling swung to net income of SAR 31.4 mn in 3Q from a net loss of SAR 9.4 mn a year earlier, despite a 3% y-o-y drop in revenue to SAR 810.7 mn on lower rig activity, according to a Tadawul filing. The company credited the turnaround to more efficient rig moves, cost-cutting, lower net finance costs, and a smaller tax bill. Gross income rose 32% to SAR 133.2 mn, while operating income climbed 48.6% to SAR 82.2 mn.

Offshore rigs are coming back online. Revenue rose 6% q-o-q as four offshore rigs resumed operations, partly offset by weaker land-rig activity. Arabian Drilling suspended some of its Gulf offshore rigs in late March as a precaution, citing the “regional situation.” The return of these rigs in mid-August helped Arabian Drilling recover from an SAR 31.5 mn net loss in 2Q.

The 9M picture remains much weaker. Net income plunged 90.6% y-o-y to SAR 6.9 mn as revenue fell 8.1% to SAR 2.4 bn, which the company blamed on the offshore rig suspensions and the absence of long rig moves this year. Gross income declined 24.7% to SAR 304 mn, while operating income dropped 38% to SAR 160.8 mn. Cost efficiencies and lower general and administrative expenses helped cushion the impact.

REMEMBER- Arabian Drilling's backlog reached a record SAR 18 bn after it secured a four-year, SAR 2 bn offshore contract from Khafji Joint Operations for four jack-up rigs in September. The company expects revenue from the contract to begin flowing toward the end of 4Q 2026.

KEC’s land sale powers rebound

Knowledge Economic City's (KEC) bottom line surged in 3Q as a major land sale and stronger residential project margins helped the Madinah developer swing back into the black. Net income more than tripled to SAR 99.7 mn, up 253% y-o-y, while revenue jumped 98.8% to SAR 245.1 mn, according to a Tadawul filing. Gross income rose 251.6% to SAR 181.8 mn, while operating income climbed 455.6% to SAR 139.7 mn.

A land sale did much of the heavy lifting. KEC recognized SAR 169.6 mn in revenue from a land parcel sold in July, accounting for around 69% of its quarterly top line. A newly opened hotel also added to revenue.

Foreign ownership rules are helping: The company reported better margins on its ongoing residential projects and attributed higher residential revenue to the new non-Saudi property ownership law, as KEC was designated a foreign-ownership zone in June. The company told us that month it was readying three developments for foreign buyers and reworking its sale processes to handle them.

The YTD picture: For 9M 2026, KEC reported SAR 71.3 mn in net income against an SAR 26.7 mn loss a year earlier, as revenue rose 40.2% to SAR 330.5 mn. Operating income reached SAR 119.4 mn, reversing a SAR 25 mn operating loss in 9M 2025. The company still had accumulated losses of SAR 371 mn, equivalent to 10.93% of its capital, at the end of September.

Al Babtain’s gains outrun slowing sales

Al Babtain Power and Telecom kept its bottom-line growing in 3Q 2026 though the gain leaned on cost control more than demand. Net income rose 16.7% y-o-y to SAR 148.5 mn, while revenue edged up just 1.5% to SAR 788.5 mn, according to a Tadawul filing. Lower administrative, marketing, and financing costs did the work; the modest top-line growth that came through was from the poles-and-lighting and towers-and-steel-structures businesses.

The nine-month picture told the same story: Net income climbed 41.5% y-o-y to SAR 443.4 mn, outpacing a 12% increase in revenue to SAR 2.4 bn, on the same cost prudence and sales factors as 3Q.

Dividends halved: Al Babtain's board approved a SAR 31.97 mn dividend for 3Q 2026, equivalent to SAR 0.50 per share, down from SAR 1 per share for the same quarter last year, according to a separate disclosure. The payment date will be announced later.