Saudi Electricity Company (5110) Q2 2024 earnings summary

Executive summary

• Revenue rose 15.5% year-over-year to SAR 38.2 billion in H1 2024, with net profit up 16.6% to SAR 5.2 billion, driven by higher demand, regulatory WACC increase, and effective cost management.

• Subscriber base reached 11.2 million (+1.2%), energy demand rose to 146 TWh (+6.1%), and peak load hit 72.9 GW (+9.5%) compared to H1 2023.

• H1 2024 capex surged 62.5% year-over-year to SAR 25.1 billion, reflecting accelerated investment in grid infrastructure and growth plans.

• Fitch upgraded SEC's credit rating to A+ (Stable) in May 2024, aligning with the Kingdom's sovereign rating.

• Advanced sustainability, localization, and customer satisfaction, with a net zero target by 2050 and improved customer satisfaction scores.

Financial highlights

• EBITDA for H1 2024 reached SAR 17.5 billion, up 2.0% year-over-year, with a margin of 45.8% (down 6.1pp).

• Basic & diluted EPS for H1 2024 was SAR 0.21, up 23.5% year-over-year.

• CapEx surged 62.5% year-over-year to SAR 25.1 billion, with guidance of SAR 35–40 billion for 2024.

• Cash dividend of SAR 2.9 billion (SAR 0.70 per share) declared.

• Cash flows from operating activities dropped to SAR 6.7 billion in H1 2024 due to negative working capital and higher loans/advances.

Outlook and guidance

• CapEx guidance for 2024 set at SAR 35–40 billion, supporting future grid and infrastructure expansion.

• SEC is focused on expanding its asset base, enhancing operational efficiency, and supporting Saudi Vision 2030 goals for energy security, reliability, and sustainability.

• Continued investment in grid expansion and diversification of the energy mix to meet rising demand.

• Strategic investments to drive further RAB growth and energy security.