Al Arabia Chairman: Profit drops due to accounting standard, management reshuffle align with next phase

Mohamed Alkhereiji, the newly appointed Chairman of Arabian Contracting Services Co. (Al Arabia)

Mohamed Alkhereiji, the newly appointed Chairman of Arabian Contracting Services Co. (Al Arabia), said the company delivered positive financial performance in the first quarter of 2025, despite a year-on-year (YoY) decline in profit.

He attributed the drop in profit to accounting standards that led the company to report high and inflated financing costs related to the Remat contract, which he said did not reflect the company’s underlying profitability.

Speaking to Al Arabiya TV, Alkhereiji said the company is seeing growth across multiple business segments, supported by its wide coverage in major cities across Saudi Arabia and the broader Arab region. He added that the company is continuing to expand its advertising network, particularly in digital advertising.

The company’s ongoing expansion is a natural progression of its strength in advertising solutions, Alkhereiji said, noting that Al Arabia has broadened its footprint in recent years across Saudi Arabia and the region. He described recently signed contracts as a positive indicator of its strong annual client base.

While overall growth in the advertising market has slowed, Alkhereiji said the company’s offerings remain a top priority for advertisers, even amid tighter budgets and a more challenging market environment.

Commenting on recent changes in senior management, Alkhereiji said the reshuffle was aimed at adding new expertise to the leadership team. “These are positive steps intended to support the company’s next phase, which includes potential partnerships and acquisitions in Saudi Arabia and the wider Arab region,” he said.

Alkhereiji also said he would chair the company’s executive committee, which will be formed after receiving the required approvals from the Capital Market Authority.

According to data compiled by Argaam, Al Arabia posted a 52% drop in net profit to SAR 48.2 million in Q1 2025, down from SAR 100.8 million in the same period a year earlier.

On May 14, the board of directors accepted Alkhereiji’s resignation as CEO, effective May 15, and appointed him Chairman through the end of the current board term on March 17, 2026.

The company also named Mansour Al Obaikan as CEO, effective June 15, 2025.