• Decrease in sales quantities along with decrease in the sales average prices of final products.

• Reversal of impairment on the Plant, Machinery and Equipment.

• Decrease in the cost of sales due to the decrease in sales quantities.

• Decrease in the provision of doubtful debt that led to a decrease in general and admin expenses.

• Increase in finance cost due to the adoption of IFRS 9 for effective interest rate on the loans obtained from the Saudi Industrial Development.

• Increase in the other income due to the adoption of IFRS 9 for effective interest rate on the loans obtained from the Saudi Industrial Development.

• Decrease in sales quantities along with decrease in the sales average prices of final products.

• Reversal of impairment on the Plant, Machinery and Equipment.

• Decrease in the cost of sales due to the decrease in sales quantities.

• Decrease in the selling and distribution expenses due to the decrease in sales quantities.

• Decrease in general and admin expenses due to a decrease in the provision of doubtful debt.

• Decrease in the banking finance charges.

Increase in the other income due to the adoption of IFRS 9 for effective interest rate on the loans obtained from the Saudi Industrial Development.

• Decrease in sales quantities along with decrease in the sales average prices of final products.

• Reversal of impairment on the Plant, Machinery and Equipment.

• Decrease in the cost of sales due to the decrease in sales quantities.

• Decrease in the selling and distribution expenses due to the decrease in sales quantities.

• Decrease in general and admin expenses due to a decrease in the cost of the employment.

• Increase in finance cost due to the adoption of IFRS 9 for effective interest rate on the loans obtained from the Saudi Industrial Development.

• Increase in the other income due to the adoption of IFRS 9 for effective interest rate on the loans obtained from the Saudi Industrial Development.

1 - The interim condensed consolidated statement of profit or loss for the three and six month periods ended 30 June 2024 included a reversal of impairment in property plant and equipment amounting to SR 81 million. The accumulated impairment as set out in note 4 of interim condensed consolidated financial statement amounted to SR 574 million as at 30 June 2024 (31 December SR 655 million) and the balance of property, plant and equipment in the interim condensed consolidated statement of financial position as at 30 June amounted to SR 643million (31 December: SR 585 million). We were unable to obtain sufficient appropriate evidence and complete our review about the carrying amount of those accounts because of the unavailability of complete information and time limitation imposed by the reporting deadline as of the date of our report.

2 - As of 30 June 2024, the Company did not comply with the loan covenant requirements in respect of loan from Saudi Industrial Development Fund (SIDF) with long term portion amounting SR 200 million and continued presenting long term loan under non-current liability in the interim condensed consolidated statement of financial position as at 30 June

2024. This resulted in overstatement of non-current liabilities with SR 200 million and understatement of current liabilities with the same amount.

Had we been provided with the completed set of our requirements together with the explanation and information we sought for and we completed our review of those accounts for the period ended 30 June 2024, matters might have come to our attention indicating that adjustments might be necessary to the interim condensed consolidated financial statements for the three-month and six-month periods ended 30 June 2024.

Qualified Conclusion

Except for the potential effect and adjustments to the interim condensed consolidated financial statements that we might have become aware of had it not been for the situation described in qualification 1 above, and subject to management doing a reclassification of loan liability as set out in qualification 2 above, based on our review, nothing has come to our intention that causes use to believe that the accompanying interim condensed consolidated financial statement has not been prepared, in all material respects, in accordance with IAS 34 as endorsed in the kingdom of Saudi Arabia.

Material uncertainty relating to going concern

We draw attention to Note (1) of the interim condensed consolidated financial statements, which indicates that., the current liabilities of the Group exceeded its current assets by SR 285 million (December 31, 2023 SR 200 million). Additionally, the Company defaulted on paying SIDF installment of SR 142 million. Additionally, the Group had negative operating cash flow of SR 18 million (June 30, 2023 SR 12 million) and incurred an operating loss of SR 53 million during the six month Period ended 30 June 2024 (six month ended 30 June 2023: SR 37 million). Additionally, the Group was in breach of its loans’ financial covenants. The Group is in the process of restructuring its loans. Management is confident that the Group will ultimately be successful in the restructuring of SIDF loan and resolving the breach. The company’s management prepared a business plan to support the Group’s continuity for a period of more than 12 months and prepared the accompanying condensed consolidated financial statements on a going concern basis. Our review conclusion is not modified in respect of this matter.