BAAN CEO upbeat about Q1 results amid turnaround, restructuring steps

Fahad Al-Obailan, CEO of BAAN Holding Group Co

Fahad Al-Obailan, CEO of BAAN Holding Group Co., said that while the company’s operational activity may be relatively affected by the overlap with the holy month of Ramadan and some political factors surrounding the market, overall indicators point to a positive start to the first quarter of this year, backed by the turnaround and restructuring steps.

In an interview with Argaam, the CEO added that Q1 performance is expected to benefit from capital gains of around SAR 60 million resulting from the sale of a stake in a real estate development company, which will support BAAN’s financial results and cash flows.

The catering segment has now moved beyond the initial cost phase following expansion and has begun generating positive returns, recording operating profits of about SAR 3.5 million last year. Growth and margin improvement are expected to continue in the coming periods, driven by an increase in operating contracts and improved efficiency.

“We are currently implementing a comprehensive plan that includes a capital increase, alongside acquiring high-quality operating assets. In addition, we hold an issue premium balance of approximately SAR 525 million, aimed at restructuring our financial position and addressing accumulated losses fundamentally, paving the way for a phase of growth, financial stability, and a much stronger financial position,” said Al-Obailan.

The company is adopting a balanced approach combining restructuring and measured expansion. The restructuring aims to improve operational efficiency and free up resources, while expansion focuses on high-return opportunities aligned with market changes and consumer behavior, especially given the company’s experience in these segments. All future investments are evaluated based on strict criteria to ensure sustainable returns and enhance profitability and liquidity,” he added.

Al-Obailan also pointed out that BAAN’s net loss in Q4 2025 was mainly due to provisions and non-cash accounting losses, noting that asset impairment provisions amounted to around SAR 43 million, while losses from asset disposals reached approximately SAR 37 million.

Additionally, the entertainment segment was negatively affected during the quarter by intensified competition and the aging of some branches. The company is currently addressing this by upgrading existing locations and expanding into new, high-quality sites aligned with customer expectations, according to the top executive.

Regarding the hotel segment, the CEO said that the company’s operations in Jeddah and Riyadh showed strong performance supported by seasons, events, and conferences. “Some hotels in Jeddah recorded occupancy rates nearing 75%, while occupancy in Riyadh exceeded 80% during certain periods, compared to weaker performance in regions such as the Eastern Province and Tabuk,” he continued.

According to Argaam’s data, BAAN logged losses of SAR 158.8 million in Q4 2025, compared to SAR 12.4 million in the same period a year earlier.