MIS expects up to SAR 2B contract awards through 2026

Ibrahim Al-Moammar, Vice Chairman of Al Moammar Information Systems Co. (MIS)

Ibrahim Al-Moammar, Vice Chairman of Al Moammar Information Systems Co. (MIS), said the company expects to secure new ICT contract awards worth between SAR 1.5 billion and SAR 2 billion by year-end, excluding data center projects.

In an interview with Argaam, Al-Moammar said the TASI-listed company's outstanding contract backlog exceeds SAR 19 billion, noting that it continues to execute its projects according to schedule with solid operational execution.

On MIS financial performance in Q3 2026, Al-Moammar explained that revenue and gross profit growth reflects improved operational performance and an elevated market share in both data centers and core ICT operations.

Further, gross profit margins for Q3 2026 improved compared to the previous quarter across both segments, he continued.

However, profitability margins remain subject to project nature, business mix, and IFRS 15 revenue accounting treatments (distinguishing between principal vs. agent roles).

He indicated that some software license supply activities are recorded on a net basis when the company acts as an agent, while data center project revenues are booked at the gross project value when operating as a principal. This results in variations in profit margins across business divisions.

Regarding factors affecting net profit, Al-Moammar pointed to three main negatives. Firstly, a SAR 10.2 million non-cash fair value drop has emerged on certain investments. He stressed that this represents an accounting loss rather than realized operating losses or business deterioration.

“We conduct quarterly valuations of our investments through an independent, specialized third party, factoring in market conditions and risk premium models,” Al-Moammar said.

The second factor was an increase in expected credit loss provisions for trade receivables and contract assets, driven by portfolio growth and higher receivable balances, paired with the company's conservative approach to provisioning, he added.

Meanwhile, MIS does not expect significant increases or sudden spikes in provisions in Q4 2026, with potential partial reversals anticipated. Their levels remain subject to continuous assessment based on developments in the business portfolio.

The third factor was higher financing costs (FCs) stemming from project expansion and increased working capital needs, and elevated interest rates, said Al-Moammar. He noted that some FCs are recurring in nature, while others are related to non-recurring items.

Regarding future outlook, Al-Moammar said the company expects continued operational improvement in Q4 2026, with revenue and gross profit surpassing Q3 levels. This is alongside sustained topline and margin growth heading into 2027.

MIS' future growth strategy rests on four key pillars. The first is achieving annual growth of between 15% and 20% in its core ICT business, while the second is targeting a 20% market share in data center construction.

The third pillar focuses on expanding data center management and operations, while the fourth involves continuing to pursue investment opportunities, establish subsidiaries, and expand into ventures that complement the company’s core activities and growth strategy, he added.

Al-Moammar also noted that MIS holds investments across several sectors and companies, including banking, insurance, Fintech, data centers, and AI technology partnerships.

Regarding investment in Vision Bank, Al-Moammar explained that the bank has commenced operations and capital increase procedures are underway, with MIS participating proportionately.

As for dividends, Al-Moammar said MIS follows the dividend policy approved by the general assembly, explaining that the distributions announced during the current year relate to previous financial periods.

Future distributions depend on board evaluation of liquidity, credit facilities, and overall financial health, balancing shareholder returns with growth financing needs, he underlined.

According to Argaam’s data, MIS profit declined to SAR 76.42 million in the first nine months of 2026, compared with SAR 91.23 million in the same period a year ago. Its Q3 profit also fell by more than 17% YoY to around SAR 21 million.