National Central Cooling Co.

1. Company Overview & Earnings Context

National Central Cooling Company PJSC (Tabreed) is a Dubai Financial Market (DFM)-listed district cooling company. Its principal activities include the supply of chilled water, operation and maintenance of cooling plants, construction of secondary networks, manufacturing of pre-insulated pipes, and related consultancy services.

Tabreed reported H1 2026 revenue of AED 1.13 billion, slightly higher year-on-year. However, profitability declined, with net profit falling to AED 207.65 million, compared with AED 291.07 million in H1 2025.

2. Financial Performance Snapshot

• Revenue: AED 1.13 Billion (+1.8% YoY)

• Gross Profit: AED 527.80 Million (-0.5% YoY)

• Operating Profit: AED 365.44 Million (-6.8% YoY)

• Profit Before Tax: AED 229.97 Million (-27.7% YoY)

• Net Profit: AED 207.65 Million (-28.7% YoY)

• Profit Attributable to Equity Holders: AED 191.82 Million (-30.4% YoY)

• Earnings Per Share (EPS): AED 0.068, compared with AED 0.097 in H1 2025

Compared with H1 2025:

• Revenue increased from AED 1.108 billion to AED 1.128 billion.

• Gross profit decreased from AED 530.59 million to AED 527.80 million.

• Operating profit decreased from AED 392.26 million to AED 365.44 million.

• Profit before tax decreased from AED 318.16 million to AED 229.97 million.

• Net profit decreased from AED 291.07 million to AED 207.65 million.

• Profit attributable to equity holders decreased from AED 275.72 million to AED 191.82 million.

3. Operational Highlights & Key Metrics

• Chilled Water Revenue: AED 1.069 Billion, broadly flat YoY

• Value Chain Revenue: AED 59.18 Million (+52.9% YoY)

• UAE Revenue: AED 1.067 Billion (+2.0% YoY)

• Revenue Outside UAE: AED 61.15 Million (-1.3% YoY)

• Operating Cash Flow: AED 631.64 Million (+39.9% YoY)

• Total Assets: AED 14.58 Billion

• Total Equity: AED 6.71 Billion

• Cash & Bank Balances: AED 660.82 Million

4. Key Performance Drivers

Tabreed's core chilled water business remained stable during H1 2026, generating AED 1.069 billion in revenue, broadly unchanged from AED 1.069 billion in H1 2025. Growth came primarily from the Value Chain business, where revenue increased approximately 52.9% YoY to AED 59.18 million, from AED 38.70 million.

Despite modest overall revenue growth, profitability was pressured by higher expenses and financing costs. Administrative and other expenses increased to AED 162.36 million from AED 138.34 million, while finance costs rose to AED 151.97 million from AED 113.87 million. The share of results from associates and joint ventures also declined to AED 7.39 million from AED 16.10 million, contributing to the decline in profit before tax.

Cash generation, however, strengthened considerably. Net cash generated from operating activities increased to AED 631.64 million, compared with AED 451.47 million in H1 2025, representing growth of approximately 39.9%.

5. Outlook & Forward Considerations

Tabreed did not provide specific quantitative full-year 2026 financial guidance in the interim financial statements. The company noted that its business is seasonal, with chilled-water demand generally increasing during the hotter summer months, resulting in higher revenues during this period. It also cautioned that interim operating profits are therefore not necessarily indicative of full-year profitability.

The Group had AED 774 million in authorised contractual capital commitments as of 30 June 2026, up from AED 385.9 million at the end of 2025. Management also stated that operations remained stable despite the geopolitical environment and that it did not anticipate a material impact on the Group's financial position or performance based on information available at the reporting date.

6. Investor Takeaway

Tabreed's H1 2026 results showed a mixed performance. Revenue remained resilient at AED 1.13 billion, supported by strong growth in its Value Chain business, while its core chilled water revenue remained broadly stable. Operating cash flow was particularly strong, increasing nearly 40% YoY to AED 631.64 million.

On the other hand, profitability weakened, with operating profit declining 6.8% and net profit falling 28.7%. Higher finance costs were a major factor, increasing by approximately 33.5% YoY to AED 151.97 million. EPS consequently declined from AED 0.097 to AED 0.068.

The combination of stable core revenue, rapidly growing Value Chain revenue and stronger operating cash generation provides positive operating signals, while the decline in earnings and higher financing costs remain important areas to monitor through the second half of 2026.