OQGN net profit rises 7.1% in Q1 2026

MUSCAT, MAY 25
OQ Gas Networks — Oman’s sole gas transmission operator —posted a 7.1 per cent increase in net profit for the first quarter of 2026, supported by higher construction activity, growth in its regulated asset base and stable operational performance.
The company reported net profit of RO 13.5 million for the three-month period ended March 31, 2026, compared with RO 12.6 million in the corresponding period of 2025. At the discussion session held on May 20, company officials highlighted that revenue growth and improved profitability were mainly driven by ongoing network expansion projects and rising concession income.
Total income climbed by 30.8 per cent to RO 48.8 million in Q1 2026 from RO 37.3 million a year earlier. The increase was largely attributed to higher construction revenue linked to strategic gas pipeline projects, including the Fahud-Sohar Second Loop Line Project.
Figures presented during the session showed that construction revenue contributed RO 10.5 million to the increase in total income, while concession income added RO 0.8 million. Other sources contributed an additional RO 0.2 million.
The company’s income build-up, net of construction costs, rose by 6.1 per cent to RO 31.1 million in Q1 2026, compared with RO 29.3 million in the same quarter of last year. Net profit margin improved to 43.5 per cent from 43 per cent a year earlier, reflecting continued operational efficiency and cost recovery measures.
OQGN also maintained strong expense recovery levels during the quarter. The company recovered 97.6 per cent of operating expenses, slightly lower than the 99.7 per cent recorded in Q1 2025 but still reflecting efficient cost management.
Construction costs for the quarter rose to RO 17.7 million from RO 8 million in the corresponding period of 2025 due to increased activity on expansion projects. However, the company maintained a stable construction margin of 7.79 per cent.
The regulated asset base continued its steady expansion, growing at an average annual rate of 5.3 per cent since 2023. Total concession assets and contract assets increased to RO 1.167 billion in Q1 2026, up from RO 1.158 billion in 2025 and RO 1.042 billion in 2023.
Concession income also showed gradual growth over the years, reaching RO 79 million on a rolling annual basis in Q1 2026, compared with RO 72.7 million in 2023. Meanwhile, the effective interest rate declined slightly to 7.38 per cent, indicating stable financing conditions.
The company said its debt profile remains healthy and below industry averages, giving it additional borrowing capacity to support future capital expenditure plans. Historical net debt-to-adjusted EBITDA stood at 3.85 times in Q1 2026, while net debt-to-regulated asset base ratio reached 0.38 times.
OQGN further reaffirmed its commitment to maintaining an attractive dividend policy for 2026, supported by stable operating cash flows and long-term regulated revenue streams.