Saudi Paper profit doubles to SAR 104.7 million in nine months

Summary

• Saudi Paper Manufacturing's nine-month 2026 profit rose 113.5% to SAR 104.73 million, the company reported.
• Revenue climbed 19.6% to SAR 748.67 million on extra output from production line 5.
• Third-quarter gross margin narrowed to 27.0%, squeezed by higher pulp, packaging and shipping costs.

The latest

Saudi Paper Manufacturing Company more than doubled its earnings in the first nine months of 2026, posting net profit of SAR 104.73 million against SAR 49.06 million a year earlier, a 113.5% increase. Revenue rose 19.6% to SAR 748.67 million, which the company attributed to higher sales volumes drawn from the additional capacity of production line 5.

Details

• The headline number: Net profit for the nine months ended in 2026 reached SAR 104.73 million, up from SAR 49.06 million in the same period of 2025, according to the company's filing. The 113.5% jump was reported alongside a revenue base that grew at roughly a sixth of that pace.
• Revenue drivers: Sales reached SAR 748.67 million against SAR 626.05 million a year earlier, a 19.6% rise. The company said the gain came from increased sales volumes after it began drawing on the additional production capacity of line number 5, which recycles paper into tissue rolls.
• Per-share earnings: Earnings per share rose to SAR 2.83 from SAR 1.32 in the comparable period, broadly tracking the doubling in net profit and indicating the gain was not diluted by an expansion in the share count during the period.
• The quarter alone: Third-quarter 2026 profit came in at SAR 20.24 million, up 39.8% from SAR 14.48 million in the third quarter of 2025. The quarterly pace is well below the nine-month growth rate, meaning the bulk of the annual improvement was booked earlier in the year.
• The one-off adjustment: The company said the year-earlier period included non-recurring gains of SAR 6.2 million from the deconsolidation of a non-operating subsidiary in Morocco. Stripping that item out, it said profit from continuing operations rose 144.1% rather than 113.5%.
• The margin squeeze: Gross margin for the third quarter fell to 27.0% from 34.4% in the preceding quarter. The company attributed the 7.4-point drop to higher wood pulp and packaging material costs, along with rising shipping and logistics expenses it linked to geopolitical conditions in the region.
• Balance sheet: Shareholders' equity, excluding minority interests, stood at SAR 665.65 million at the end of the period, compared with SAR 562.25 million a year earlier, an increase of SAR 103.4 million that closely tracks the nine-month profit figure.
• What was not specified: The company did not set out how long it expects elevated pulp and freight costs to persist, nor did it give a target margin or a figure for the remaining untapped capacity at line 5.

Background

Saudi Paper Manufacturing operates in paper recycling and the production of tissue paper rolls. Production line 5 is the capacity addition the company credits for this year's higher sales volumes, and the Moroccan subsidiary it deconsolidated was described as non-operating.

Between the lines

The two headline figures pull in opposite directions. Volume from line 5 lifted revenue 19.6% and profit 113.5% over nine months, but the quarterly numbers show the input-cost side catching up: a 7.4-point margin contraction in a single quarter, and third-quarter profit growth of 39.8% against a nine-month rate nearly three times that. Capacity delivered the year; pulp, packaging and freight prices will determine how much of it survives.

What's next

The fourth-quarter and full-year 2026 results will show whether gross margin recovers from 27.0% or compresses further, and whether line 5 volumes can keep offsetting pulp and freight costs.

Source: Argaam