Najran Cement Rejects Auditor Report, Mandates Interim Dividend

Najran Cement shareholders rejected the auditor's report for 2025 at an ordinary general meeting on June 25. The same session approved a mandate for the board to distribute interim dividends for 2026.

The meeting was a second session after the first failed to reach a legal quorum. Turnout hit 22.3% of capital, enough for a valid vote. Chairman Fahad bin Abdullah Al Rajhi and Vice Chairman Majed bin Ali bin Musallam attended, along with board members and committee heads.

The company did not specify reasons for the auditor report rejection. Such a vote typically signals shareholder dissatisfaction with the audit process or the presentation of financial statements, though the company did not elaborate. The rejection did not block the appointment of a new auditor. Shareholders approved United Accountants (RSM) as external auditor for upcoming periods. RSM will audit the financial statements for the second and third quarters of 2026, plus the annual period, and the first quarter of 2027. Fees are set at SAR 475,000 excluding VAT.

Shareholders also voted down a proposal to delegate the general assembly's authority to the board regarding licensing requirements under Article 27 of the Companies Law. That article covers conflicts of interest and competing businesses. The board will not have delegated power to authorize such matters for the typical one-year period or until the end of the current board cycle.

The board did receive approval to distribute interim dividends on a semi-annual or quarterly basis for 2026. This gives the board flexibility to manage liquidity and provide regular returns, provided the company meets regulatory requirements.

The dividend mandate is a positive signal for income-focused shareholders. The auditor rejection leaves a governance question open. The next scheduled event is the Q2 2026 financial report, due by mid-August.