BinDawood Holding: 2Q26 First Take: Mixed set of results, but operationally better than we thought

Research evidence excerpt

J P M O R G A N

CEEMEA Equity Research

10 August 2026

BinDawood Holding

2Q26 First Take: Mixed set of results, but operationally

better than we thought

Our Take: BinDawood’s 2Q26 revenues, gross profit and EBIT came in

7%/5%/18% ahead of JPMe and although we lack disclosure by vertical, it is likely

that the core food retail segment delivered a better-than-expected outcome on sales

(reported consolidated earnings also reflect the recent acquisition of Vaza Foods,

which makes the y/y comparisons elevated). A better-than-expected top line with

some contraction of gross margin (109bps y/y) likely indicates that the retailer’s

increased promotional activity drove a notable consumer response. With Panda

reporting a meaningful gross margin decline (-265bps y/y) in the same period, we

see BinDawood’s results as showcasing a higher level of promotional activity in

KSA as consumers maintain cautious spending patterns and competition remains

intense – a negative read-across for Alothaim (UW) and the sector overall, in our

opinion.

Noteworthy Areas: 1) BinDawood’s revenue grew 11.4% y/y in 2Q26,

coming in 6.6% ahead of our expectations, with management attributing

growth across verticals except pharma retail, which continues to be under

pressure from modifications in guidelines to the Wasfaty programme. 2) Gross

margin declined 109bps y/y to 35.1% (42bps below JPMe), driven by a

stronger promotional backdrop in the grocery segment. 3) Opex as a % of sales

improved 179bps y/y in 2Q26, suggesting positive operating leverage and was

103bps better than JPMe. 4) Despite a strong operating performance, net profit

attributable to shareholders declined 4.3% y/y in 2Q26 to SAR 50m (total net

income +5.3% y/y to SAR53m), due to a greater share of profits attributable

to non-controlling interests, a decline in deposit income and higher finance

costs linked to the loan for new acquisitions and new leases.

Likely changes to consensus: JPMe and Bloomberg consensus estimates

remain closely aligned across the P&L. While the better-than-expected 2Q26

operating earnings print suggests potential upside to FY26 revenue and

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