SABTCO Stock: Performance of Saudi Public Transport Company

SABTCO Stock is the symbol that distinguishes the Saudi Public Transport Company in the Saudi stock market (Tadawul), where it is listed under symbol 4040. SABTCO is one of the oldest companies providing public transport services by bus within and outside the Kingdom of Saudi Arabia. The company began as a government entity, but with the economic transformation witnessed in the Kingdom, it was converted into a public joint-stock company. The company aims to meet the mobility needs of citizens, residents, pilgrims, and Umrah performers, and is a strategic hub in implementing Vision 2030 programs, particularly in reducing reliance on private transport and enhancing sustainable public transport. Since the listing of SABTCO Stock in the market, it has become available for trading by individual and institutional investors, with the government retaining a majority stake through the Ministry of Transport. This listing reflects a shift towards governance and transparency, as the company holds periodic general assemblies and commits to regularly disclosing its financial results. SABTCO Stock serves as an indicator of the performance of the land transport sector, given its leading role, and any developments in its policies or financial results directly affect investor confidence in this vital sector.

SABTCO's core activities cover public transport services by bus between Saudi cities, in addition to transporting pilgrims and Umrah performers during the Hajj and Umrah seasons. The company operates regular bus lines between major cities such as Riyadh, Jeddah, Mecca, Medina, Dammam, and Abha, in addition to providing public transport services within urban areas and special projects for transporting employees and students. Recently, the company has expanded to include international transport services across borders and the transportation of goods and containers related to air and sea transport. Among SABTCO's projects is also the operation of public transport lines in cities in collaboration with government entities as part of new urban transport projects. Additionally, the company has launched subsidiaries specializing in bus maintenance and driver training, enhancing operational integration and reducing operational costs. These activities make SABTCO a comprehensive player in the Saudi transport ecosystem, and its ability to face the challenges in the sector, whether from competition or rising operational costs, is further strengthened by its position.

The Saudi Public Transport Company (SABTCO) was established in the 1970s as a government entity responsible for organizing public transport by bus in the Kingdom. With the developments in the economic sector and the Kingdom's move towards privatizing some vital sectors, SABTCO was transformed into a public joint-stock company and was listed on the Saudi financial market (Tadawul) under symbol 4040. The listing came at a later period after 2020, opening the door for ownership and investment in the company for individuals and institutions. Following the listing, the company held its first general assembly in May 2025, reflecting a new phase of governance and transparency. The Saudi government, through the Ministry of Transport, holds a majority stake in the company, while the remaining shares are freely traded in the market. The listing provided the company with opportunities to attract new capital and benefit from disclosure and oversight requirements, as well as allowing investors to closely monitor SABTCO's performance through periodic disclosures and financial reports issued by the company via Tadawul.

SABTCO's financial performance in recent years has shown significant fluctuations. In 2024, the company recorded a net loss of SAR 9.6 million, with a loss of SAR 10.7 million in the fourth quarter of the same year. In 2025, losses expanded to SAR 24 million in the first quarter alone, reflecting ongoing pressures from rising operational costs and slowing revenues. However, the company recorded sporadic quarterly profits; in the third quarter of 2024, it achieved a profit of SAR 10.2 million, while the profit for the second quarter of the same year was SAR 40 million. Yet, these profits were insufficient to offset the accumulated annual losses. This financial volatility reflects the challenges faced by the sector in terms of seasonal demand, competition, and high operating costs, in addition to the burdens of new expansion projects. These indicators highlight the necessity to focus on cost control and enhance operational efficiency in the near future.

SABTCO Stock price has experienced sharp fluctuations recently. At the beginning of 2025, the stock price ranged between SAR 9 and SAR 11, reaching SAR 10.07 in the session on January 22, 2025, up from SAR 9.68 in the previous session. Over the last six months, the stock price decreased by 36.3%, but it rebounded by 21.67% in the last three months, according to market data. The company's market value is based on the stock price and the number of outstanding shares, estimated in hundreds of millions of riyals. As for the price-to-earnings (P/E) ratio, it cannot currently be calculated due to the company recording net losses in recent years, as this indicator requires positive annual earnings. These indicators reflect investors' decisions, as price fluctuations indicate market sensitivity to the company's results and future expectations.

SABTCO has not distributed dividends to its shareholders during 2024 and 2025 due to recording net losses and not achieving distributable profits. The company's dividend distribution policy is based on achieving sufficient operating profits to cover costs and allow for the distribution of a portion of profits to shareholders, in addition to the requirements of the general assembly and policies of the government entities that own shares. Given the current financial situation, SABTCO focuses on enhancing revenues and controlling expenses, deferring any dividend distribution until it achieves sustainable positive financial results. This approach is common among companies undergoing restructuring or investment expansion periods, where priority is given to investing resources in business development and reducing debts before returning to dividend distribution.

The public transport sector in Saudi Arabia is considered a vital sector witnessing rapid growth and development. SABTCO operates in a competitive environment facing indirect competition from ride-sharing services such as Uber and Careem, local transport companies, as well as modern train projects (such as the Haramain Train and city trains). The company is also affected by new urban transport projects implemented by government entities, such as rapid transit buses in major cities. Although SABTCO has a competitive advantage as a government-owned company with a long history of transporting pilgrims and passengers on long routes, competition is increasing with the emergence of new companies and smart transport technologies. To address this, the company focuses on developing its services, entering into strategic partnerships, and expanding its service base to include maintenance and driver training, enhancing its ability to maintain its market share amidst the radical transformations in the sector.

SABTCO has witnessed several significant developments during the period 2024–2025. In March 2025, the Board of Directors approved the establishment of two subsidiaries; the first specializing in bus fleet maintenance, and the second in vehicle driving education. The company also announced the signing of a public transport contract in Tabuk worth SAR 113.8 million, reflecting its direction towards diversifying income sources and entering new projects. In May 2025, the company held its first ordinary general assembly after listing in the market, and the results of the meeting were announced, enhancing the company's transparency and commitment to governance principles. The company issued financial reports showing continued pressures on financial performance, especially with a net loss of SAR 24 million recorded in the first quarter of 2025. These developments reflect the company's commitment to expansion and improving operational efficiency, despite the financial and administrative challenges it faces.

SABTCO focuses on diversifying revenue sources and expanding its service base in its future plans. Among the key growth strategies are: (1) establishing specialized subsidiaries in bus maintenance and driver training to reduce operational costs and open new markets; (2) signing new transport contracts with government entities, such as the public transport project in Tabuk; (3) developing logistics services related to transport, including the transportation of goods and containers. The company also aims to improve fleet efficiency and adopt modern technologies for managing operations, with a focus on digital transformation to provide competitive smart services. The company relies on its partnerships with government entities and support from the Ministry of Transport, in addition to benefiting from financing and expansion opportunities provided by its listing in the financial market. SABTCO also seeks to adapt to market transformations by developing urban transport services and participating in infrastructure development projects under Vision 2030.

When analyzing SABTCO's financial performance, it is evident that the company is undergoing a transitional phase characterized by fluctuations in profits and losses. In 2024, it recorded a net loss of SAR 9.6 million, while the loss expanded to SAR 24 million in the first quarter of 2025. These results stemmed from rising operational costs, seasonal revenue declines, and burdens from new projects. Among other indicators, the price-to-earnings (P/E) ratio is currently unavailable due to the absence of positive earnings, and the company has not distributed dividends in the last two years. The fluctuations in the stock price in the market reflect investors' sensitivity to the company's results and their expectations for its future financial trajectory. This financial situation underscores the need for business restructuring and improved cost management, with a necessity to monitor results in upcoming periods to assess the company's ability to achieve positive financial transformation.

Since its listing on the Saudi stock market, SABTCO has placed special emphasis on enhancing governance and transparency in its operations. The company held its first general assembly in May 2025, marking an important step towards involving shareholders in decision-making and applying best management practices. The Board of Directors consists of representatives from the Ministry of Transport and the public business sector, overseeing the implementation of strategies and expansion plans. The company is also committed to regular disclosure of its financial results and operational developments, in accordance with the requirements of the Capital Market Authority. The executive management is focused on implementing operational transformation plans and developing services, with an emphasis on improving financial performance and expanding the customer base. Effective governance is a key factor in enhancing investor confidence and ensuring business sustainability, especially amid the challenges the company faces in the current phase.

SABTCO faces several key challenges, including rising operational costs, increasing competition from smart transport services and trains, and changing patterns of demand for public transport. Achieving a balance between expanding new projects and controlling operational expenses remains crucial for ensuring financial sustainability. On the other hand, Vision 2030 offers growth opportunities through urban transport projects and infrastructure development, allowing SABTCO to expand its presence in new cities and benefit from the increasing demand for sustainable transport. Additionally, establishing specialized subsidiaries may open new markets in maintenance and training. Despite the challenges, continued government support and strategic alliances with regulatory entities provide the company with greater flexibility to adapt to market transformations and achieve its long-term goals.

SABTCO Stock represents an important indicator of the performance of the public transport sector in the Kingdom of Saudi Arabia. Amid the financial and operational challenges facing the company, investors remain in constant monitoring of the stock's performance and operational and administrative developments. As the company continues to implement expansion and financial restructuring plans, its future results are expected to be influenced by its success in controlling expenses and increasing revenues. Furthermore, investor participation in general assemblies enhances their role in guiding the company's strategies and monitoring their implementation. Ultimately, the investment decision remains linked to a thorough analysis of financial and operational performance, with the necessity of consulting a licensed financial advisor to ensure decisions are based on sound foundations and aligned with individual investor goals.