We draw attention to Note (2) to the condensed interim consolidated financial statements, which indicates that the Group incurred a net loss of SAR 23,640,938 for the six-month period ended 30 June 2026G. As at that date, the accumulated losses exceeded 50% of the Company’s share capital. In addition, the Group’s current liabilities exceeded its current assets by SAR 19,253,812 as at that date.

These events and conditions, along with other matters set out in Note (2), indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. The Group’s ability to continue as a going concern is principally dependent on its ability to achieve its business plans and generate sufficient cash flows to enable it to meet its obligations as they fall due, without any significant reduction in its operations, taking into consideration various matters detailed in the aforementioned note.

Our opinion is not modified in respect of this matter.

The increase in accumulated losses is mainly attributable to the recognition of impairment losses on the property, plant and equipment of company during 2024, amounting to SAR 80.23 million, in addition to the recognition of an additional impairment provision against property, plant and equipment and goodwill during 2025, amounting to SAR 5.30 million. Accordingly, the total impairment provisions recognized against property, plant and equipment and goodwill amounted to SAR 85.53 million.

As part of the measures to address the accumulated losses and strengthen the Company’s financial position, the Board of Directors, on July 21, 2026, issued its recommendation to reduce the Company’s share capital, followed by a capital increase through a rights issue. This is intended to address the accumulated losses and support the Company’s future growth strategy.

The Company’s growth strategy includes diversifying its product portfolio and expanding its industrial activities, including the expansion into the manufacturing of cement products through the Saudi Land Factory, which commenced production on a gradual basis and actual sales in 2024. The strategy also includes completing the preparation and commissioning of the high-density plastic products factory, which is expected to commence production during the third quarter of 2026.

The proposed capital increase is also intended to support the Company’s operating activities and strengthen its financial position.

The procedures related to the capital reduction followed by the capital increase are currently underway. On July 21, 2026, the Company appointed a financial advisor to arrange and execute the capital reduction and subsequent capital increase in accordance with the applicable procedures and requirements.

With reference to Article (132) of the Companies Law, the Board of Directors will invite the Extraordinary General Meeting to convene no later than September 26, 2026, to consider the Board’s recommendation regarding the reduction of the Company’s share capital followed by its increase, and to take the necessary resolution in this regard, subject to obtaining the required approvals, including the approval of the Capital Market Authority (CMA).

The Company is also complying with the procedures and instructions issued by the Capital Market Authority concerning listed companies whose accumulated losses exceed 20% of their share capital.

Any applicable laws, regulations, or procedures governing such circumstances will be duly applied.