Thank you, Claire. Good afternoon and good morning, everyone on the call, and I'd like to welcome you to Saudi Energy full year 2025 earnings conference call.

My name is Saad Alghossari, from Saudi Energy Investor Relations team. I have with me on the call today Engineer Khalid Al-Ghamdi, our President and CEO; Mr.

Abdulaziz Al-Muhaiza, Executive Vice President and Group CFO; and Mr. Oqab Al-Nefaie, our Executive Director of Control and Reporting.

Before we start the call, I need to direct your attention to our disclaimer in slide number 2 of the presentation. As usual, a Q&A session with the management will follow the presentation, please join the conference to ask a question.

I will now give the floor to our CEO, Engineer Khalid Al-Ghamdi, who will provide key highlights of 2025.

Thank you. Ladies and gentlemen, good day, everyone, and thank you for joining us today.

I'm very delighted to start with introducing our new branding initiative, which you might have heard about. I'm pleased to begin by introducing a milestone in our journey.

At the end of the last week, we officially launched our new corporate identity and announced our rebranding to Saudi Energy. This transition reflects more than a name change.

It represents the natural evolution of our role within the Kingdom of Saudi Arabia energy ecosystem and aligns with the structural transformation underway across Saudi Arabia's energy sector. Saudi Energy today plays a broader and more strategic role.

Beyond operating the electricity network, we are enabling the transformation of the national energy system by integrating renewable capacity at scale, advancing energy storage solutions, modernizing and automating the grid, enhancing localization, attracting investment, and strengthening energy security of supply. This evolution supports Saudi Vision 2030 and reinforces our mandate to deliver reliability, resilience, and long-term sustainability.

2025 has been a defining year, not only for us in Saudi Energy, but for Saudi Arabia itself. As Saudi Arabia accelerates toward a more diversified and sustainable economy, Saudi Energy stands at the center of this transformation, serving as the backbone of national progress.

Today, power is far more than a utility service. It requires infrastructure deployment at an unprecedented scale, delivered with uncompromising reliability and operational excellence and discipline.

We at Saudi Energy is fully embracing this responsibility. The transformation underway across the Kingdom is reshaping our industry.

Rapid industrialization, the growth of the data and digital ecosystem, large-scale urban development, and the transition toward a more diversified energy mix are fundamentally redefining how power systems are planned, built, and operated. In this context, Saudi Arabia represents one of the fastest-growing power systems globally, and Saudi Energy is at the forefront of that evolution.

We are building and modernizing the electricity infrastructure that powers daily life, enables economic growth, and strengthens national competitiveness. In 2025, we delivered tangible and measurable progress.

First, on advancing our mandate as an integrated energy national champion: we strengthened network reliability and system resilience while meeting record demand growth, accelerating large-scale renewable integration, and battery energy storage systems. Again, our role within the Kingdom's evolving energy mix has become increasingly central, reflecting both operational capability and strategic relevance and importance.

Second, execution excellence at scale: we continued to execute and deliver infrastructure expansion at historic levels, without compromising reliability, safety, or operational efficiency. At the same time, we enhanced service quality and customer experience.

Third, sustainable, high-quality growth: our regulated required revenue framework continues to provide structural earnings, visibility, and long-term investment clarity. This enables disciplined and efficient capital deployment, predictable returns, and sustained expansion of our regulated asset base, underpinning quality, low-risk earnings convergence.

Finally, financial strength and balance sheet resilience are maintained. Our strong balance sheet and investment-grade profile well-positioned us to fund growth efficiently while maintaining financial discipline.

This resilience ensures our ability to continue expanding our asset base and deliver long-term value to shareholders during a high investment cycle. In summary, 2025 reflects execution excellence, structural growth, and maintained financial strength, positioning Saudi Energy for sustained value creation in the years ahead.

Let me now turn to the numbers that underpin this 2025 performance. As I said, our growth and strong earnings in 2025 were structural, demand-driven, and supported by execution excellence and operational efficiencies.

We are seeing structural moment across business, driven by demand expansion, regulated asset base growth, and record investments that well-positioned us for sustained future growth. Energy sold reached 349.2 TWh, reflecting 7.9% increase year-on-year.

This growth was supported by strong demographic trends, accelerating electrification, expanding industrial capacity, and vibrant non-oil economic activity across the Kingdom. Moving to our regulated asset base, which remains the core driver for our long-term quality earnings expansion, our transmission and distribution required asset base reached 256 billion Saudi riyals, representing 10.8% growth year-on-year, marking a double-digit growth for the second consecutive year.

This reflects both the scale and the pace of grid modernization and expansion. Supporting our future growth trajectory, we delivered record capital expansion of 82.2 billion Saudi riyals, up 66.7% year-on-year.

These investments support both near-term growth and our long-term energy transition objectives, ensuring that we remain at the forefront of the Kingdom's power sector transformation. Now let us look at our financial performance.

This acceleration is operational and asset growth translated into record financial performance. Revenues increased 15.3% to 102.2 billion Saudi riyals, achieving the highest revenue on record.

Net profit increased 88.9% to almost 13 billion Saudi riyals, reflecting high revenue operational efficiencies and absence of previous year's non-recurring impacts. Excluding one-off items in 2024, including 5.7 billion Saudi riyals legacy settlement expense and 481 million Saudi riyals settlement income, EBITDA increased 10.1% to 41.5 billion Saudi riyals, demonstrating strong earnings convergence.

Also, excluding the aforementioned one-off items in 2024, net profit in 2025 would have rose 7.4% to 13 billion Saudi riyals, demonstrating sustainable earnings growth. Turning to operational excellence, this slide clearly demonstrates the strength and the discipline of our execution across the system and continued successful strategic delivery.

Starting with security of supply, despite rising demand and system complexity across generation, transmission, and distribution, system reliability and operational readiness improved materially. Overall generation availability remained high at 87.3%, supported by a 25.5% reduction in the forced outages.

Furthermore, generation availability during 2025 summer peak remained very high at 95.9%, ensuring security of supply during peak demand periods and reinforcing system resilience. Power generation remains a cornerstone of Saudi Energy's mandate to deliver reliable, affordable, and sustainable power to the Kingdom.

Distribution losses also improved to 7.4%, a 7.5% reduction year-on-year, highlighting better network efficiency and stronger loss management. On network reliability and operational excellence, we continued to deliver measurable improvements.

SAIDI improved to 68 minutes per customer, down 1% year-on-year, while SAIFI declined 8% to 1.35 interruptions per customer. These reductions reflect sustained grid reinforcement, predictive maintenance, and automation investment, directly improving customer reliability and rising customer expectation levels.

Automation remains a key structural driver as well. Distribution automation increased to 40.8%, up 12% year-on-year, and this enhances fault detection, reduces restoration time, and strengthens operational control, positioning us for a more digital and smarter grid.

For localization and ESG perspective, progress has been made equally strong. Our local content score increased to 64.17, while our S&P ESG score rose significantly to 65, reflecting a 30% improvement year-on-year.

With pride, this significant ESG score puts us at the number one position among all listed companies in Saudi Arabia and number one among all electric utilities in the MENA region. Additionally, it will position us among all global utility benchmark, as we are 66% higher than the global sector average.

This is a culmination of our sustainability advancement journey anchored in our net-zero 2050 ambition and well-integrated sustainability strategy in our corporate strategy. Finally, on customer experience, customer satisfaction improved to 86%, while time to connect was reduced to 2.57 days, a 14% improvement year-on-year.

This is tangible evidence that our operational upgrades and progress are translating into better customer outcomes. Overall, these indicators confirm that 2025 was not just a year of investment expansion, but a year of measurable operational enhancement across reliability, efficiency, sustainability, and service quality, and very in line with our strategic ambitions and priorities.

With that, let me hand over to our CFO to take you through the operational and financial performance. Thank you.

Thank you, Engineer Khalid, and ladies and gentlemen, good afternoon and thank you for joining us today. I'm really pleased to take you through a detailed operational and financial performance of the year.

Moving to slide number 9, the company have expanded across its core businesses: generation, transmission, and distribution. To look into more details on the generation side, which is backed by a very strong power purchase agreement take-or-pay, the total capacity of the company during the year, we ended up with 55—sorry, 56.7 GW own generation capacity, representing 64% of the market share in the entire generation business here in the Kingdom.

These capacities have generated 237.6 TWh of power during the year, with an efficiency of 37.4%. When we look at the transmission business, which is backed by the regulated asset base regulations, also we have expanded massively in this business with the 104.6 thousand circuit kilometers of transmission assets, increasing by 4.9%.

The number of transformers and also substations have also increased by in the range of 4% to 7%. Also, the fiber optics have also expanded by 9%.

The company have also added 8 GW of battery storage capacity that have already been energized during the year of 2025. When we look at the distribution and retail business, the total distribution network line have increased by 6.6%, reaching to 860,000 circuit kilometers.

The number of transformers and also substations have increased between in the range of 2% to 2.1%. The customers served have increased by 260,000 customers, reaching to 11.5 million customers today.

We have sold in 2025 349.2 TWh, which represents 7.9% increase in energy sold compared to 2024. Moving on to slide number 10, where we are showing how we are strengthening our security of supply and transforming the energy mix and executing the energy transition, our generation project portfolio has now reached to 23.4 GW, including 11 gas thermal projects under development.

What we have realized during 2025, 3.4 GW, which is the signing and the completion of PP13-14 as well as Qurayyah expansion IPP 3 GW. When we look at the energy transition, 22.3 GW, 8 projects under transition from liquid to gas, and that's the aim that we are aiming to achieve by 2030.

We successfully completed the 1.7 GW of PP10 conversion, and we are also started the conversion of Rabigh 2 projects 2.8 GW. On the renewable trends, the company was successfully awarded 600 MW last October, the solar PV Samtah projects in the southern side of the Kingdom, which positioned the company as a major developer in the renewable space in the Kingdom.

The company also, as part of its strategy, continued to participate in all of the SPPC's tenders projects, including the upcoming one, the Round 7. When it comes to boosting the security of supply and reliability, the company have successfully also restored 10 units and extended its life to make sure that we have enough capacity to fulfill the demand that is needed in the system that is coming from all type of customers, which we will be taking more in details in the upcoming slides.

Now in the next slide, we will shed some lights on the business expansion and the execution. If we look into the details of the transmission and distribution, we have been adding more capacity, more transmission lines, and also unique investments in battery storage and also in automation of systems and network.

This is not going to be just a one year of growth, but in fact, it's a sustainable growth that we will see year-on-year up until 2030 where we will be reaching the overall Vision 2030 targets. When we look at the transmission line, today we are standing at 104.6, and the aim is that we will be reaching 146 thousand circuit kilometers.

The number of substation by 2030 will be reaching 1.5 thousand substations. The distribution line will be reaching 1 million and 124 thousand circuit kilometers of distribution line, and 872,000 substation of distribution across the Kingdom.

When we look at along the side of the growth in the regulated business, there has also been growth in the non-regulated business portfolio as well. We can also look into more details with facts, figures, and numbers here.

When we look at the telecom business, the Dawiyat Telecom now has added 3 million IoT SIM cards, support the smart meter of SEC. The expansion also on the broadband reach 34 cities.

We have added 75,000 customers, reaching to 890,000 customers on the FTTX. On the PDC side, there is a major projects that are being executed by the Project Development Company, 1,324, valuing almost 52 billion Saudi riyals worth of projects under execution.

It is part of the group to have the Energy Infrastructure Consortium Company, which is the arm of SEC that bids for new capacity with the SPPC. Today, they have been awarded 23.4 GW of portfolio of capacity that are under construction.

When we look into more details of how this is being translated in 2025 financials, the revenue have grew by 15.3%, reaching to 102.2 billion Saudi riyals. Gross profit reached to 20 billion, 18.9% growth.

The operating profit has grew also by 62.1%. The net profit, we managed to have a very successful year with an increase compared to the normalized last year by 7.4%, 12.9 billion Saudi riyals.

This has resulted of an earning per share to 0.96 halalas per share. The normalized EBITDA grew by 10.1%, reaching to 41.5 billion Saudi riyals.

When we look in the how this revenue and growth and top-line growth and what is it being supported by, it's clearly the electricity sales, as I've mentioned, increased by 9.3% year-on-year, supported by growth in the quantity sold 7.9%. Electricity sales have generated an addition of revenue of 6.2 billion.

Meter maintenance, electricity connection, and transmission user system combined have contributed for an additional 350. The other operating revenue almost reached to a 7 billion, supported by the balancing account and the required revenue of SEC.

Now when we look into more details, what's the driver of the increase of electricity sales? It's across all businesses, across all segments: industrial, commercial, government, and industrial as well.

It is all with high single digits and or double digits in some of these sectors, which indicates again a growth in the economy and a potential growth of SEC's business in the next 5 years. Moving on to slide number 15, where we're showing in more details how this is being achieved of an income bridge compare 2025 with 2024, the key driver of this again is the operating revenue and the balancing account, and excluding the fuel settlement that was settled last year, the company has been very effectively and efficiently managing its operational cost as the business and the assets grow year-on-year.

Moving on to the more details of the capitalized assets and how much we have grown our business in terms of the regulation and how much the regulator is going to compensate us from the RAB perspective, the capitalized assets from capital work in progress, as shown in the slide, has been growing year-on-year. I think the majority of it has come this year from transmission with 31.4 billion, including the investment in batteries, as well as a strong and sustainable growth in distribution investments.

This has resulted, and again, in a double-digit growth in our RAB, which has resulted in a greater returns of shareholders based on the weighted average cost of capital that was set by the regulator. When we look in the investing and how much we've invested during the year, significant investments compared to 2024: 66.7 billion, major investments again in transmission as well as in distribution, capturing the growth, connecting renewable energy, supporting the energy transition, as well as investments, as I mentioned, in smartification and customer experience, taking SEC's operations and customer experience to the next level.

We're expecting this is slightly lower than last year in terms of the amount of investment in 2026 to be in the range of 70 to 70 billion Saudi riyals. When we look in the debt portfolio and the funding pool of SEC, the company maintain a really balanced debt maturity in the next 5 years and beyond, managing its maturity effectively without any specific spikes in any years.

Also, we are working on diversifying the source of funding from different pool of liquidity, regionally, locally, as well as internationally, coming from the capital markets, from syndications, and export credit agencies, and other aspects. The company remains active in the green and sustainable financing as it's in line with our strategic goals in supporting energy transition here in the Kingdom.

We remain, with all of this growth, having a balanced balance sheet and balanced gearing when we look into a comparable ratios of a similar utilities globally at the size of SEC. We remains have a very strong equity base and very efficient capital structure in order for us to be able to finance all of our projects in the most efficient way to deliver the cheapest levelized cost of electricity for the Kingdom.

The total assets have reached now to 635.8, and also we're expecting this to grow this year with all the projects that we have to support the Vision 2030 obviously goals and some of the major activities that are upcoming in the Kingdom, like the Expo and the World Cup and other things, which requires a huge amount of investments from our side to be able to fulfill all the demand that would come from all the events that are going be here, hosted here in the Kingdom, along with some of the initiatives of the vision itself. In conclusion, we remain with the same strategy and same business plan that we've been basically communicating and speaking to the market.

We continue with a specific strategic sustainable growth in the business supported by a very well-established regulatory regime that is supporting the company to accelerates its financial performance and record greater returns to our shareholders. We remain, from a strategic perspective, focused on operational excellence and supporting the resilience of our grid and reliability and efficiency for our operations.

We remain diversifying and maintaining our financial sustainability to be a financially sustainable company to finance its growth and capturing the greatest value to our shareholders as well as the stakeholders and as well in partnering with the government to execute the Vision 2030 targets and beyond. Thank you.

Now back to you, Claire, for the Q&A.

Yes, thank you so much for the presentation. I have a few questions.

I'll start with one. Can you comment, please, on how your financials are being impacted, if there is any impact, by the 2 halalas tariff surcharge?

Is it affecting the distribution revenue? If yes, how does it affect it?

If and when part of the revenue will be transferred to the regulator? That's my first question.

There is one more, also, any chance you could comment on the utilization of the solar plants which have been connected to the grid last year? I think there were quite a few, I think that's it for my side.

Thank you.

I got your first question, but the second question is not clear. Maybe let me answer your first question.

Just to clarify, the change in tariffs, and you mentioned the 2 halalas changes, which is part of the heavy consumption tariff scheme that was implemented by the regulator, just to give a perspective on the regulatory regime that we are operating in, we're not impacted by change in tariffs or change in fuel prices. We have a regulatory regime that compensate us based on a specific formula, which is basically the regulated asset base model plus the PPA for generation, which is the required revenue.

The required revenue get calculated by specific formula, which is RAB on our assets plus depreciation, plus return on investment, plus pass-through cost and O&M. This is how it's being calculated, and that's why SEC is being shielded from any risks associated with any of the government changes in policies.

Just to simply answer your question, if the increase in 2 halalas is not impacting us, and if there is a decrease, won't be impacting us, because that's a pass-through to the balancing account of the government. Yes,

just to clarify, but since you're collecting this tariff still from customers, is it part of your distribution revenue in any way, or it's not? I understand that it's being passed through in one or the other direction, so...

It is, yeah. It is part of our distribution revenues.

That's correct. Whatever shortage that we might have from the required revenue, you will see that the other revenues, which is the balancing account, will cover this.

Okay. Yes, and my second question was about the average capacity utilization of the solar plants last year within your grid system, because they have been quite a few new projects which just being launched.

I just wonder how much that capacity actually contributes to the generation, like any comment in percentage, like if it's 30%, 40%, or higher, would be very helpful. Thank you.

Just to answer this question, I think the total renewable capacity is keep picking up here in the Kingdom as renewable in general is being penetrating the system. I don't have a specific answer how much it's contributing, but they are operating as a base load.

I think the Investor Relations, you can reach out to them later, they can give you a specific answer to how much they are contributing to the system on average, maybe.

Thank you so much.

Yes, thanks again. Actually, I have quite a few questions, so.

One of the topics I wanted to sort of investigate was the possible impact on the liquid fuel consumption in 2026. You said that you've completed conversion of one plant, and there was another one in the pipeline, and there was a ramp-up of Jafurah gas plant and possibly gas supply coming to the new gas-fired capacity.

Do you expect the liquid fuel consumption to decline in 2026, or this will be dependent on the overall demand growth and other factors?

I think the plan for the energy transition and the conversion from liquid to gas is based on a scheduled plan between the company and, obviously, the Ministry of Energy and the ecosystem and, obviously, Saudi Aramco. The plan is we have successfully closed one of the projects, the rest is going to come.

What we can assure and give an assurance on is that by 2030, the target is to complete all of the 22.3 GW of liquid-fired generation to gas. That's now what we are aiming for.

We are starting gradually. I think we will be peaking by '28, '29 in terms of closing projects, but by 2030, we will complete all of the conversion of the all capacities.

It's rather going to be like 2027 and 2028 when it will be So you expect that drop in conversion to be similar for now in the next one or two years, and then it should pick up, right?

That's true.

Okay. Thank you so much.

Maybe if I can, if there is no one else in the queue, in the full financials, which I understand are not available yet, you usually provide financials for the subsegments, and I was quite curious to understand how profitability changed year-on-year in generation, let's say, and distribution. I understand that in distribution there was specifically strong growth over the past two years.

Can you comment on what is driving this? Is it just the growth in overall connections and the expansion of the network overall, or this is demand, or this is both?

Thank you.

The driver for the generation increasing revenues and profitability is obviously different than transmission and distribution. Here, it's being backed by the PPA, which as long as you are available, you have available capacity, whether you're dispatching or not, and you will be getting your CCR, or you're going to get paid whether you dispatch or not.

In terms of the transmission and distribution, the more we grow our RAB, the more return and the more revenue we're going to have for transmission and distribution, and this is how the regulation is being designed. That's what has been the focus for the company: is to have more efficient, available generation capacity, although the actual capacity of 2025 did not that much of an increase compared to previous years, but what we have successfully did, we have made more capacity available for dispatch, and that's the driver for more revenue on the generation side.

Thank you. Any chance you could share with us any outlook on the expected revenue growth in 2026?

Should we expect the same very strong rate of growth to continue this year?

I think that's very clear in our presentation. We are, again, a company that is being driven by and incentivized to execute more.

Transmission and distribution, the growth year-on-year is expected to be the same, especially with the targets that we have for 2030. On the generation side, we are executing, and the portfolio is really big in slide number 10, under construction 23.4 GW of capacity, let alone the partnership that we have on the IPPs as well.

We're expecting a growth across all the businesses, the core regulated business as well as the non-regulated business, too.

Thank you so much. Great comments, appreciate it.

Welcome.

Thanks so much. Thank you for your continued engagement and for joining us today.

Today's presentation and all supporting material will be available on our website as well as our investor relation app, which you can see the QR code on the screen. Once again, thank you very much, and we look forward to engaging with you again in our next call.

Thank you.