Chemanol shareholders approve 77.8% capital reduction

Shareholders of Methanol Chemicals Co. (Chemanol) approved a board recommendation to cut the company's capital to SAR 150 million from SAR 674.51 million, a 77.8% reduction.

The move wipes out accumulated losses and resets the equity base. Chemanol had been carrying negative retained earnings, a common issue among Saudi petrochemical firms hit by weak margins and plant shutdowns over the past two years.

The capital cut takes the form of a share cancellation, not a buyback. Each shareholder's proportional stake remains unchanged. The company will now operate with a leaner balance sheet, which could improve return-on-equity metrics and make future dividend payments more feasible if methanol prices recover.

Chemanol shares trade on the Saudi Exchange under ticker 2002. The stock has fallen roughly 30% over the past 12 months, underperforming the broader Tadawul index.