A survey published by Business Europe on Thursday showed an improvement in the morale of European companies in the industrial and services sectors since last June, at a time when concerns are increasing about rising inflation and sovereign debt.
The organization, which is the largest gathering of the business sector in Europe and represents 42 federations that include about 25 million companies, said that the survey that included its members showed a decline in the percentage of industrial companies in which negative sentiment prevailed to about 33 percent in the latest survey, compared to 62 percent in June. In the services sector, the percentage decreased to 30 percent from 50 percent during the same period.
The survey, which is conducted twice a year, showed rising investment expectations, especially in the industrial sector, despite the reduction in estimates related to investment growth during the current year, according to Reuters.
On the other hand, about half of the organization's members expressed serious concern about inflation, compared to 40 percent in June, while another percentage, slightly less than half, expressed limited concern in this regard.
Inflation in the euro zone rose to its highest level in three years, recording 4 percent in October, driven by a sharp rise in food and energy prices, while energy price inflation reached 20 percent.
This came as the rise in inflation accelerated during the current year, exceeding the European Central Bank’s target of 2 percent, after the American war with Iran led to an increase in energy costs, and its effects were transmitted to retail prices in a region that depends largely on importing its energy needs.
The survey also indicated that Business Europe members are increasingly criticizing government financial policies in their countries, as more than half of the participants believe that the financial policy in their countries is characterized by excessive expansion in spending, while a wide majority believes that the European Central Bank’s directives are appropriate.
The organization said in its report that the combination of high debt levels, increasing interest costs, and delayed public financial control measures in a number of European Union member states has become an increasing source of risks, in light of the growing sensitivity of markets to financial risks.
Financial markets have pushed borrowing costs higher in France and other European countries whose public financial conditions are weak.
The Saudi transportation and logistics sector recorded growth in its revenues and profits during the first 9 months of 2026, driven by improved performance of logistics services and port companies and an increase in handling activity, in addition to a reduction in the losses of some companies.
The combined revenues of the nine companies listed in the sector increased by 13 percent to 18.08 billion riyals ($4.82 billion), and net profits increased by 20.7 percent to reach 1.063 billion riyals ($283.5 million), despite continued pressure on the profitability of car rental companies and aviation-related services.
These results gain additional importance in light of the transformations taking place in global trade routes due to geopolitical tensions in the region, and the disruptions caused by the war in the movement of navigation through the Strait of Hormuz and the Red Sea, pushing shipping companies to search for alternative paths to transport goods. These developments have demonstrated the importance of the Kingdom's geographical location. With its ports on the Arabian Gulf and the Red Sea and land transport networks, it provides alternative routes and enhances the flexibility of regional supply chains.
Navigation disturbances also prompted the acceleration of efforts to develop logistical corridors and link Saudi ports to Gulf trade centers and global markets, thus enhancing opportunities for growth in handling, warehousing, transportation, and integrated logistics services activities.
At the corporate level, the results showed a difference in benefiting from the growth of activity, with logistics services and ports companies topping the list of winners, while the profits of a number of car rental companies and aviation support services declined, which reflects the difference in the ability of activities to convert increased revenues into profits.
Sector performance
The sector includes 9 companies listed on the Saudi Stock Exchange (TASI), which are: “SAL Saudi Arabia”, “Ground Services”, “Budget Saudi Arabia”, “Theeb”, “Lumi”, “SAPTCO”, “Cisco Holding”, “Flynas”, and “Shree”.
“Saudi SAL Logistics Services” topped the sector’s companies in terms of net profits during the first 9 months, after its profits rose by 16.9 percent to about 579.9 million riyals, compared to 496.2 million riyals in the same period in 2025. Thus, it accounted for about 54.6 percent of the sector’s combined net profits, while its revenues rose by 28.2 percent to about 1.54 billion riyals.
“United International Transportation Company (Budget Saudi Arabia)” came in second place, with net profits amounting to about 199.6 million riyals, compared to 248.7 million riyals in the same period of the previous year, a decrease of 19.7 percent. It attributed the decline in its profits to the decline in short-term rental fleet operating rates, the slowdown in renewing long-term rental contracts, in addition to some customers moving to less expensive categories of vehicles, despite an 11 percent increase in revenues to about 1.91 billion riyals.
Cisco Holding came in third place, after its profits rose by 140.7 percent to about 148.5 million riyals, compared to about 61.7 million riyals in the same period in 2025, driven by improved performance of the port sector, and an increase in cargo handling volumes, in addition to the growth of logistics services activities.
SAPTCO also achieved growth in its net profits to about 81.5 million riyals, compared to 13.1 million riyals in the same period last year, an increase of about 521 percent, coinciding with an increase in revenues of 13.8 percent.
As for car rental companies, they continued to face pressure on profitability. Theeb’s profits declined by 52.2 percent to about 68.4 million riyals, despite an increase in its revenues by 15.5 percent, affected by the decrease in fleet operating rates, the increase in provisions for credit losses and financing costs, and the decline in the profitability of used car sales.
“Lumi” profits decreased by 61.3 percent to about 61.9 million riyals, affected by the decline in short-term leasing activity and the increase in operating expenses and allocations, while “Shree” recorded profits amounting to about 47.6 million riyals, a decrease of 10.7 percent, despite the growth of its revenues by 39 percent.
In aviation activities, Flynas reduced its net losses by 83.9 percent, to reach about 95.7 million riyals, compared to losses of 594.4 million riyals during the same period in 2025, while its revenues increased by 6.3 percent to about 6.44 billion riyals.
On the other hand, “Ground Services” recorded net losses amounting to about 28.6 million riyals, compared to profits of 298.5 million riyals in the first 9 months of the previous year, coinciding with a decrease in its revenues by 7.4 percent.
At the level of the third quarter of 2026, the nine sector companies recorded combined net profits of about $110.2 million (413.1 million riyals), in light of the varying performance between companies. “Saudi Sal” topped the quarterly profits with about 231.9 million riyals, a growth of 28 percent on an annual basis, followed by “Budget Saudi Arabia” with profits amounting to 71.8 million riyals, despite a decrease of 10.6 percent.
Cisco Holding's profits rose to about 63.1 million riyals, a growth of more than 271 percent, while Flynas returned to achieving quarterly profits amounting to about 27 million riyals, compared to losses recorded during the second quarter of the current year.
On the other hand, “Ground Services” recorded quarterly losses amounting to about 32.5 million riyals, while the profits of “Theeb”, “Lumi” and “Shree” declined on an annual basis.
The quarterly results indicate continued disparity in the financial performance of sector companies, with improved profits from logistics services and ports, versus pressure on car rental activities and aviation-related services.
Read the results and prospects of the sector
In a reading of the sector’s results, Dr. Sulaiman Al Humaid Al-Khalidi, a financial and economic expert, financial markets analyst and member of the Saudi Economic Association, said that revenue growth was not reflected at the same pace in all transportation and logistics services companies, explaining that “logistics and port activities led the growth of profits, in exchange for continued pressure on the profitability margins of car rental companies and aviation-related services.”
Al-Khalidi explained, in a statement to Asharq Al-Awsat, that the rise in consolidated profits “reflects the expansion of operational activity in the sector, supported by the growth of handling and logistics services, in addition to the reduction of (Flynas)’s losses.” He added that the expansion of trade, freight movement, and activities related to supply chains “opens the way for new growth opportunities, especially for companies that are able to improve their operational efficiency and benefit from increased demand.”
He pointed out that “Saudi SAL” topped the list of companies in terms of profits, in addition to the strong growth in the profits of “SISCO Holding” and the improvement of the results of “SAPTCO”, highlighting “the importance of diversifying sources of income and enhancing integration between transportation, logistics and infrastructure activities.”
On the other hand, Al-Khalidi believed that the decline in the profits of a number of car rental companies, despite the growth in the revenues of some of them, shows that “increasing the volume of business does not necessarily guarantee improved profitability; The results remain related to the efficiency of fleet management, the nature of contracts, financing costs, and the ability to control operational expenses.”
Al-Khalidi pointed out the discrepancy in the performance of aviation support activities, with the losses of “Flynas” decreasing compared to the shift of “ground services” to a loss, noting that “this discrepancy reflects the extent to which these activities are affected by changes in the volume of operations, levels of demand, and operating costs.”
He stressed that the sustainability of the sector’s growth during the next stage will depend on “the ability of companies to transform business expansion into an actual improvement in profitability margins, by raising productivity, diversifying services, and enhancing the efficiency of cost management.”
Expansion of development projects
In terms of future expectations, the CEO of G-World Studies, Mohamed Hamdi Omar, expected the continued growth of the Saudi transportation and logistics sector during the next stage. Supported by the expansion of development projects, investments in infrastructure, and efforts aimed at consolidating the Kingdom’s position as a logistical center linking 3 continents.
He said that the sector is witnessing a transformation that goes beyond increasing transportation and storage volumes to building an integrated system for logistics services, supply chain management, and employing modern technologies.
Omar explained, in a statement to Asharq Al-Awsat, that the expansion of ports, logistics areas, airports, and transportation networks, in conjunction with the growth of e-commerce, industrial and tourism activities, and major projects, enhances the demand for warehousing and distribution services, supply chain management, multimodal transportation, and specialized logistics services.
He pointed out that digital transformation will be one of the main drivers of the sector’s growth, with the increasing use of artificial intelligence, data analysis and Internet of Things technologies in fleet management, tracking shipments, improving transportation routes and managing inventory. These technologies, according to Omar, “reduce operational costs, improve asset utilization, and increase operational efficiency and profitability margins.”
He stated that growth opportunities will not be equally distributed among the sector’s activities; “Port and logistics companies are expected to benefit from the expansion of trade, industrial and export activities, while the growth of e-commerce supports demand for land transport, delivery and distribution. As for car rental companies, their opportunities will be linked to increased tourism and commercial activity, with their profitability remaining dependent on the efficiency of fleet management, their operating rates, and financing costs.”
On the other hand, Omar warned of challenges related to high costs of assets, fuel, maintenance, labor and financing, as well as intensifying competition. He stressed that pumping investments and developing infrastructure does not necessarily mean achieving quick returns. “This requires careful risk management, and ensuring levels of operation and demand commensurate with the volume of investments implemented.”
He expected investment opportunities in the sector to continue during 2027, “in parallel with the growing importance of integration between transportation activities, logistics services, and digital technologies.” He believed that companies that develop integrated solutions for their customers will be best able to diversify their revenues and enhance their competitiveness.
Omar concluded that the most prominent transformation in the sector is “the transition from a model based on owning assets and providing traditional transportation services to a model that focuses on managing supply chains and providing smart logistical solutions, which increases operating efficiency and enhances the sector’s contribution to diversifying the economy and achieving the goals of (Vision 2030).”
Copper prices rose, on Wednesday, after declining in the previous session, supported by improved investor sentiment towards artificial intelligence companies, and the continued supply shortage in China, the largest consumer of the metal in the world.
The three-month standard copper price on the London Metal Exchange rose by 0.9 percent to $13,805 per ton at 17:15 GMT, after falling by 1.6 percent on Tuesday, recording last week its largest weekly decline since March, according to Reuters.
A large part of the recent losses came from concerns that a Democratic sweep in the US midterm elections would lead to tighter regulatory restrictions on artificial intelligence, which could limit demand for copper in this fast-growing sector.
Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen, said: “Stock markets are recovering, which is supporting metal prices. “The technology sector has not collapsed yet, and it does not appear to be headed toward that.”
Shares rose on Wednesday, as investors focused on a renewed wave of optimism about artificial intelligence, following the strong results announced by Core Wave, a company specializing in artificial intelligence infrastructure.
Hansen added that the recovery of the stock market allows traders to refocus more on the fundamental factors of the market, which are still strongly supporting prices. Especially in China.
Premiums for spot physical copper prices in China witnessed a significant increase, in light of the decline in local smelter production and the limited access of sea shipments of the metal.
The copper premium at Yangshan Port, which reflects demand for imported copper in China, settled at a record level of $230 per ton for the third day in a row.
In other metals, aluminum rose on the London Metal Exchange by 1.9 percent to $3,068 per ton, after recording its lowest level in three weeks on Tuesday, affected by the increase in Chinese exports and growing hopes for an end to the conflict in the Middle East, which is a major region for producing the metal.
The Bahraini Alba Company, the largest aluminum smelter in the Middle East operating in one location, recorded a 38 percent increase in its production during the third quarter compared to the previous quarter, despite a decline in sales.
In contrast, a decline in aluminum stocks in warehouses registered with the London Metal Exchange led to a rise in the premium of short-term spot prices over standard three-month contracts to $129 per ton, the highest level in 30 years.
The rise in the dollar index contributed to limiting the gains of metals, as it makes goods denominated in the US currency more expensive for buyers who use other currencies, with markets pricing in the possibility of raising US interest rates in December.
Among other metals, zinc rose by 1.1 percent to $3,753 per ton, lead by 0.2 percent to $1,882, nickel by 1.2 percent to $16,220, and tin by 0.8 percent to $46,670.
