Specialized Medical Company (4019) Q1 2026 earnings summary

Executive summary

• Achieved resilient operational and financial performance in Q1 2026, with net profit up 9.8% year-over-year, driven by expansion of outpatient and acute inpatient services and continued execution on strategic priorities, despite seasonal headwinds.

• Completed transition from long-term care beds to higher-margin acute inpatient services and outpatient clinics, supporting improved utilization and operational efficiency.

• Launched SMC Clinics in Al Malqa, with 14 clinics operational by March 2026 and further expansion planned; outpatient platform expanded to 337 clinics.

• Maintained strong academic and clinical achievements, including renewed institutional accreditation, successful organ transplant collaborations, and multiple industry awards.

• Strengthened balance sheet with net debt/EBITDA reduced to 1.7x and cash and cash equivalents up 66.6% year-over-year.

Financial highlights

• Net revenue grew 3.3% year-over-year to SAR 380.7 million, driven by improved inpatient and outpatient utilization.

• EBITDA increased 5.6% year-over-year to SAR 69.3 million, with margin rising to 18.2% from 17.8%.

• Net profit rose 9.8% year-over-year to SAR 32.5 million, with margin improving to 8.6%.

• Operating cash flow reached SAR 83.4 million; free cash flow was SAR 69.7 million; cash and cash equivalents stood at SAR 246.7 million.

• Capital expenditure for Q1 2026 totaled SAR 13.8 million, mainly for hospital and clinic expansion.

Outlook and guidance

• FY 2026 net revenue guidance: SAR 1.6–1.7 billion (+4.0% vs FY25); EBITDA margin: 23–25%; net income margin: 14–16%.

• Management remains confident in meeting full-year guidance, closely monitoring for any significant changes.

• Further rollout of SMC Clinics in Al Malqa expected throughout 2026, with full capacity of 35 clinics; development pipeline includes new hospitals and a mental health facility, with operations for the latter expected in Q1 2027.

• No plans to adjust project timelines or ramp-up schedules despite sector uncertainties; projects remain on track.

• Management is evaluating the impact of new IFRS standards effective in 2026 and 2027, with no significant impact expected.