Raydan’s accumulated losses reach 60.41% of capital

Logo of Raydan Food Co.

Raydan Food Co. said its accumulated losses amounted to 60.41% of its capital, based on preliminary financial results for the period ended June 30, 2025.

In a statement to Tadawul, the company said its board of directors was informed of the losses on Aug. 10, with the total reaching SAR 95.5 million.

For more news on listed companies

Raydan attributed the losses mainly to lower sales, reduced revenue from contracts and franchise operations, higher selling and marketing expenses, impairment charges on right-of-use assets and land, impairment of property and equipment, and foreign currency valuation differences. Other factors included impairment losses on its investment in an associate, its share of the associate's losses, and higher cost of sales.

The company said it plans to restructure its service and operational segments, increase branch sales by diversifying restaurant offerings and focusing on delivery services under a comprehensive marketing plan, and target the catering sector by signing long-term strategic agreements to boost revenue. It also aims to cut operational costs by consolidating warehouses, slaughterhouses, and the central kitchen; expand geographically into unserved areas through catering contracts and new branch openings; and restructure and grow its franchise model, particularly outside the Kingdom.

Raydan said the deadline for the board to disclose its recommendations on the losses was July 13, 2025, and that the final date for the board to call an extraordinary general assembly to vote on the company’s continuation is Nov. 10, 2025. It added that procedures and regulations for listed companies with accumulated losses of 20% or more of their capital will apply. The board has recommended taking the necessary steps and complying with laws and regulations applicable to companies whose accumulated losses exceed 50% of capital, while safeguarding shareholders’ rights and interests.

The company noted that the dates are in line with Article 132 of the Companies Law, which requires a joint-stock company whose losses reach half of its issued capital to disclose this and provide recommendations within 60 days from the date of awareness. An extraordinary general assembly must then be held within 180 days to decide on the company’s continuation or dissolution and take necessary actions to address the losses.

Raydan said it had already taken steps to address the losses. On May 29, 2025, it announced on Tadawul the board’s recommendation to reduce the company’s capital, followed by a capital increase through a rights issue as part of its loss-recovery plan. On Aug. 7, 2025, it submitted the capital reduction request to the Capital Market Authority (CMA) to complete the required regulatory procedures.

According to Argaam data, Raydan posted a net loss of SAR 18.4 million for the first half of 2025, compared with a SAR 4.3 million loss in the same period a year earlier. The board has recommended cutting capital from SAR 158.08 million to SAR 73.14 million, a 53.74% decrease, to restructure capital and offset accumulated losses. Last Thursday, the company filed a request with the CMA to approve the capital reduction. After completing the reduction, it plans to raise SAR 155 million through a rights issue.