Executive Summary
Naseej for Technology Co delivered a strong top-line performance in QQ2 2025, reporting revenue of SAR 100.18 million, up approximately 93.5% year over year and showing robust quarter-over-quarter growth versus Q1 2025. Gross profit rose to SAR 22.996 million with a gross margin of about 23%, while EBITDA reached SAR 2.607 million and operating income SAR 2.238 million, signaling modest operating leverage at the margin level. Net income, however, remained minimal at SAR 0.113 million, yielding a net margin near 0.11%. The company also posted negative per-share cash flow metrics (operating cash flow per share of -SAR 3.43 and free cash flow per share of -SAR 3.44) despite a positive EBITDA, underscoring working-capital and cash-flow intensity in the current quarter.
From a liquidity and leverage perspective, Naseej shows a conservative balance sheet: current ratio of 1.769 and quick ratio of 1.622 indicate sturdier short-term liquidity, yet cash ratio is only 0.0801, highlighting limited cash buffers. The company faces a stretched working capital cycle, with days sales outstanding (DSO) at 167.38 days and a cash conversion cycle of 137.98 days, driven by extended receivables and modest inventory dynamics. Net debt remains modest (debt ratio ~0.085; debt-to-equity ~0.186), implying limited leverage and good capital resilience to support growth initiatives.
Strategically, Naseej is positioned to benefit from Saudi Arabia’s aggressive digital transformation agenda in education, government, and cultural sectors, where it has historically operated. Cross-sell opportunities across campus management, e-learning, library and information-resource solutions, and digitization projects could support revenue growth in the near to mid-term. However, near-term profitability is challenged by operating-expense intensity and cash-flow dynamics, with no dividend payout in QQ2 2025. Overall, the quarter demonstrates revenue momentum and stable gross margins but requires improvement in cash generation and working-capital efficiency to translate EBITDA gains into sustained net income and free cash flow.
Key Performance Indicators
Key Insights
Revenue: SAR 100,177,608 (YoY +93.5%, QoQ roughly flat in reported data) | Gross Profit: SAR 22,995,162 | Gross Margin: 22.95% | EBITDA: SAR 2,607,200 | Operating Income: SAR 2,237,992 | Net Income: SAR 112,730 | Net Margin: 0.11% | EPS: SAR 0.0226 | Diluted EPS: SAR 0.0226 | Weighted Avg Shares: 5,000,000
Liquidity and leverage: Current Ratio 1.769; Quick Ratio 1.622; Cash Ratio 0.0801 | DSO 167.38 days; DIO 23.43 days; DPO 52.84 days | Cash per share SAR 2.19; Operating Cash Flow per Share (O...
Financial Highlights
Revenue: SAR 100,177,608 (YoY +93.5%, QoQ roughly flat in reported data) | Gross Profit: SAR 22,995,162 | Gross Margin: 22.95% | EBITDA: SAR 2,607,200 | Operating Income: SAR 2,237,992 | Net Income: SAR 112,730 | Net Margin: 0.11% | EPS: SAR 0.0226 | Diluted EPS: SAR 0.0226 | Weighted Avg Shares: 5,000,000
Liquidity and leverage: Current Ratio 1.769; Quick Ratio 1.622; Cash Ratio 0.0801 | DSO 167.38 days; DIO 23.43 days; DPO 52.84 days | Cash per share SAR 2.19; Operating Cash Flow per Share (OCFPS) -SAR 3.43; Free Cash Flow per Share -SAR 3.44 | Debt Ratio 0.0848; Debt to Equity 0.186; Enterprise Value Multiple 93.57 | Price to Sales 2.30; Price to Book 1.717; Price to Earnings 510.07; EV/EBITDA 93.57
Notes: The earnings-per-share and margin figures reflect the quarterly period ending 2025-06-30; some reported ratios appear influenced by the modest net income base and share count consistent with a small-cap profile.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
100.18M |
93.48% |
0.00% |
| Gross Profit |
23.00M |
110.12% |
0.00% |
| Operating Income |
2.24M |
96.47% |
0.00% |
| Net Income |
112.73K |
123.37% |
0.00% |
| EPS |
0.02 |
123.42% |
0.00% |
Key Financial Ratios
operatingProfitMargin
2.23%
operatingCashFlowPerShare
$-3.43
freeCashFlowPerShare
$-3.44
priceEarningsRatio
510.07
Management Commentary
Transcript availability: Not provided in the dataset for QQ2 2025.
Management themes (where available in transcripts):
- Strategy and growth initiatives: (No direct quotes available)
- Operational execution and efficiency: (No direct quotes available)
- Market conditions and demand environment: (No direct quotes available)
Impact: Without management quotes, the analysis relies on disclosed financials and industry context to infer potential commentary on backlog, project mix, and regional demand drivers. If a transcript becomes available, extract quotes on product mix shifts (e-learning, campus management, libraries, digitization), contract backlog, utilization, and any guidance around government versus private sector mix.
Forward Guidance
No explicit forward guidance was disclosed in the QQ2 2025 data provided. Given the revenue growth trajectory and margin profile, an investor-focused assessment would consider the following scenarios:
- Base case: Revenue continues to grow at a high single to low double-digit pace driven by Saudi digital-transformation initiatives, with EBITDA margins improving modestly as fixed-cost absorption improves and back-office efficiencies are realized. Risks include working-capital volatility and potential delays in project timing.
- Bear case: Revenue growth decelerates if government-driven project pipelines slow or if project phasing shifts to later quarters, constraining near-term profitability and cash generation.
- Bull case: Strong project wins and faster-than-expected improvement in working capital efficiency could translate to more meaningful net income and free cash flow, supported by low leverage and a supportive regulatory environment.
Key factors investors should monitor: (1) working capital improvement (DSO normalization), (2) cadence of project wins and mix (government vs. private), (3) operating expense discipline, (4) potential non-cash impairment or tax adjustments, (5) any announced guidance for 2H 2025 and beyond.