Anan Investment Holding

1. Company Overview & Earnings Context

Anan Investment Holding PJSC is an ADX-listed Abu Dhabi-based real estate investment and development company. The Group's principal activities include developing, investing in and managing real estate properties, with the majority of its operations conducted in the UAE.

H1 2026 marked a significant turnaround in financial performance, with revenue more than doubling and the Group returning to profitability compared with a net loss in H1 2025.

2. Financial Performance Snapshot

• Revenue: AED 423.9 Million (+128.7% YoY)

• Gross Profit: AED 155.4 Million (+477.3% YoY)

• Gross Margin: 36.6%, vs. 14.5%

• Profit Before Tax: AED 37.0 Million, vs. AED 10.4M loss

• Net Profit: AED 33.7 Million, vs. AED 9.5M loss

• EPS: AED 0.015, vs. AED 0.004 loss per share

• Finance Costs: AED 58.3 Million (-1.8% YoY)

The standout development was the return to profitability, supported by significantly stronger revenue and a sharp expansion in gross profit.

3. Revenue Growth & Key Performance Drivers

Revenue from contracts with customers surged to AED 423.9 million from AED 185.4 million, representing growth of approximately 129% YoY. Direct costs increased to AED 268.6 million from AED 158.5 million, but revenue growth significantly outpaced the increase in costs.

As a result, gross profit jumped to AED 155.4 million from AED 26.9 million, while gross margin expanded to approximately 36.6% from 14.5%.

Development properties stood at AED 3.45 billion at the end of June. Anan also had AED 3.26 billion of total sales committed to customers, providing visibility into future revenue recognition as projects progress.

Importantly, H1 2026 recorded no fair-value gain on investment properties, compared with an AED 44.2 million gain in H1 2025. This makes the improvement in operating profitability particularly notable.

4. Balance Sheet, Property Portfolio & Cash Flow

Anan ended June 2026 with:

• Total Assets: AED 6.87 Billion

• Total Equity: AED 1.48 Billion

• Total Liabilities: AED 5.39 Billion

• Development Properties: AED 3.45 Billion

• Investment Properties: AED 2.35 Billion

• Cash & Bank Balances: AED 199.3 Million

• Bank Borrowings: AED 473.1 Million

Total assets increased from AED 6.68 billion at the end of 2025, while accumulated losses improved to AED 62.7 million from AED 96.4 million, primarily reflecting the H1 profit.

Cash flow remained a weaker area. Anan recorded AED 89.3 million of negative operating cash flow, compared with positive AED 56.7 million in the restated H1 2025 period. Cash and cash equivalents declined to AED 199.2 million from AED 288.6 million at the beginning of the year.

5. Financial Position, Capital Raise & Key Risks

Despite the earnings turnaround, the independent reviewer highlighted a material uncertainty related to going concern. At June 30, Anan had AED 62.7 million of accumulated losses and AED 473.1 million of bank facilities repayable on demand, alongside negative operating cash flow.

The Group's local term loan remains classified as repayable on demand following payment defaults. Management stated that discussions with the bank were ongoing regarding settlement of overdue instalments.

A significant positive development occurred after the reporting period. In July 2026, Anan completed a capital increase raising AED 174.8 million in gross proceeds, strengthening its capital and liquidity position. Majority shareholders also confirmed their intention to provide financial support for at least 12 months from the issuance of the interim financial information.

6. Investor Takeaway

Anan delivered a major earnings turnaround in H1 2026, with revenue increasing 128.7% to AED 423.9 million, gross profit rising more than fivefold to AED 155.4 million and the Group moving from a net loss of AED 9.5 million to a net profit of AED 33.7 million.

The underlying operating improvement was particularly significant because the prior-year period included an AED 44.2 million fair-value gain on investment properties, while H1 2026 had no equivalent gain. The AED 3.26 billion of committed property sales also provides visibility into future revenue as projects are completed and recognised.

The main area of concern remains cash flow and financial obligations. Operating cash flow was negative AED 89.3 million, while AED 473.1 million of bank facilities were classified as repayable on demand. These factors led the reviewer to highlight material uncertainty related to going concern.

The AED 174.8 million capital raise completed in July 2026 provides an important boost to the Group's financial position. Going into H2 2026, key areas to monitor are property sales and revenue conversion, gross margins, operating cash flow, repayment or restructuring of bank facilities, liquidity and the impact of the new capital raised.