Naqi Water adds SAR 1.22M works, pushes Riyadh factory delivery to H1 2027

Naqi Water Company just put a spotlight on its Riyadh factory project by signing a contract addendum worth SAR 1.22 million (excluding VAT) and revising the delivery schedule to H1 2027. The addendum increases the project scope beyond the previously reported SAR 16.52 million contract value, and it comes with a clear tradeoff: more upgrades now, more time later.

In a disclosure to the Saudi Exchange (Tadawul), Naqi Water said it expanded the project to enhance operational readiness and accommodate future production requirements. It also confirmed the timeline change directly, with delivery now expected during the first half (H1) of 2027. The company attributed the delay to the time needed for the additional construction and electrical works, plus logistical challenges that affected the supply of necessary construction materials.

What exactly is changing on the factory side? The newly signed addendum focuses on structural and technical upgrades designed to optimize output. One of the most specific items is increasing operational floor space, particularly by expanding the mezzanine level. That mezzanine is designated for the installation of packaging machinery. In plain terms: Naqi Water is making room for more packaging capacity, which typically matters because packaging can be a throughput bottleneck. More space there is meant to enable higher production volumes and improve packaging efficiency.

The addendum also includes an upgrade to the factory's electrical infrastructure, with two highlighted components. First, the main electrical circuit breaker is being updated. Second, the total available power capacity is being increased. These are not cosmetic tweaks. They are the kind of groundwork you need when production lines demand heavier power and when the operator expects future scaling to introduce additional or more energy-intensive machinery. The company explicitly framed the upgrades as support for the energy demands of current production lines while ensuring the infrastructure can power future machinery as operations grow.

But upgrades have a cost, and Naqi Water is being explicit that the schedule extension is not optional. The company expects delivery to occur in H1 2027, and it linked the extended timeline to two drivers: implementation time for the additional construction and electrical works, and logistical challenges that affected delivery of construction materials. It further said the supply chain issues were driven by external procurement conditions and the specific procedures associated with high-specification materials. That combination is common in large industrial builds, especially where equipment or components carry more stringent requirements and lead times.

This is where the corporate finance consequence shows up. With the revised delivery date, Naqi Water said the anticipated financial impact of the Riyadh factory project on its financial statements has also been moved to H1-27. In other words, the business is not just pushing a physical milestone. It is also pushing the accounting and expected timing of project-related effects. For decision-makers tracking execution risk and financial visibility, that matters because schedule slippage can affect how quickly planned capabilities convert into revenue opportunities, and it can change when costs and project progress become visible in reported results.

There is also a governance layer to this story, and the disclosure does not hide it. Naqi Water identified the contract addendum as a related party transaction and stated it was signed with Advanced Architect Company. The company clarified the ownership link: a major shareholder holding a 50% stake in Advanced Architect Company also owns 50% of Suqia United Group. Suqia United Group, in turn, holds a 35% stake in Naqi Water Company. The company further stated that the transaction was approved according to internal policies and is compliant with the regulations and rules of the Capital Market Authority (CMA) regarding related party dealings.

For executives and board members in similar mid-build scenarios, the second-order takeaway is that this is an execution and governance combo deal. Naqi Water is expanding scope to improve operational readiness and packaging and power capacity, while simultaneously navigating procurement constraints for high-spec materials and explaining the related party structure transparently. The project is still moving toward updated technical requirements, but the schedule slip to H1 2027, and the associated shift of expected financial impact to H1-27, is the reminder that factory expansion is where strategy meets physics, supply chains, and process.