Interim report
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Condensed Consolidated Interim Financial Information 30 September 2026
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RAK Ceramics PJSC and its Subsidiaries Condensed consolidated interim financial information 30 September 2026 Table of contents __________________________________________________________________ Section A: 1. Report of the Board of Directors Section B: 1. Independent auditors’ report on review of Condensed Consolidated Interim Financial Information. 2. Condensed Consolidated Interim Financial Information.
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3 Report of the Board of Directors On financial performance during the nine months period ended 30 September 2026 5 November 2026 Dear Members, It is our pleasure to present the business & operations report for the nine months period ended 30 September 2026, along with the interim condensed consolidated financial information of RAK Ceramics PJSC, UAE (the “Group” or the “Company”) as at 30 September 2026. RAK Ceramics delivered a strong performance in Q3 2026, with revenue growth and double-digit profit growth despite continued geopolitical uncertainty, supply chain disruptions and elevated logistics costs. Strong demand in the UAE, Middle East and India, together with disciplined execution, supported the performance and enabled the Group to capture further market share opportunities in key markets. The regional manufacturing footprint, strong brand and diversified product portfolio continue to be important competitive advantages. During the quarter, the Group remained close to the customers and responded quickly to changing market conditions, using local sourcing, alternative logistics routes and inventory buffers to maintain supply and service levels. The Group continued to capture market share opportunities in key markets, while disciplined execution and proactive management actions helped maintain operational continuity despite regional and supply chain disruptions. The Group’s strong regional manufacturing and distribution footprint remained a key competitive advantage, enabling consistent product availability and reliable customer service. Continued focus on operational efficiency, market expansion and customer engagement further strengthened the Group’s position across its core markets. Overall, the quarter demonstrated RAK Ceramics’ ability to translate market opportunities into profitable growth while effectively navigating a challenging operating environment. Group Financial Highlights Group Revenue: increased by 4.4% YoY to AED 861.5 million in Q3 2026 from AED 824.9 million in Q3 2025, demonstrating the Group's resilience and ability to effectively navigate a challenging operating environment. Gross profit margin: Gross profit margin was 40.3% in Q3 2026, compared to 40.5% in Q3 2025; remained stable despite of elevated material and energy costs, supported by higher sales in the UAE, Middle East and India. Net profit after tax: increased by 15.5% YoY to AED 78.0 million in Q3 2026, from AED 67.5 million in Q3 2025. EBITDA: increased by 4.7% YoY to AED 175.7 million in Q3 2026 from AED 167.9 million in Q3 2025. Financial Health: Net Debt increased by 4.7% to AED 1.59 billion in September 2026 compared to June 2026, Net debt to EBITDA stood at 2.56x, compared to 2.48x in June 2026. Financial Highlights Total revenue in Q3 2026 was AED 861.5 million, a growth of 4.4% YoY from AED 824.9 million in Q3 2025. For YTD September 2026, total revenue stood at AED 2,445.1 million, growth of 0.7% compared to AED 2,428.2 million in YTD September 2025. Gross profit in Q3 2026 margin was at 40.3%, compared to 40.5% in Q3 2025. For YTD September 2026, Gross profit margin remained stable at 40.3%, in line with YTD September 2025. Profit before tax in Q3 2026 increased by 13.4% YoY to AED 98.3 million, compared to AED 86.6 million in Q3 2025. For YTD September 2026, Profit before tax remained at AED 237.0 million in line with YTD September 2025 at AED 237.8 million. Net profit after tax in Q3 2026 increased by 15.5% YoY to AED 78.0 million, from AED 67.5 million in Q3 2025. For YTD September 2026, Net profit after tax increased by 1% YoY to AED 184.5 million, compared to AED 182.7 million in YTD September 2025. EBITDA in Q3 2026 increased by 4.7% to AED 175.7 million from AED 167.9 million in Q3 2025. For YTD September 2026, EBITDA declined by 0.8% YoY to AED 460.5 million, compared to AED 464.3 million in YTD September 2025. Net debt position stood at AED 1.59 billion, up by 4.7% QoQ. Net debt to EBITDA stood at 2.56x from 2.48x in June 2026.
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4 Financial highlights Segment performance highlights Tiles: Revenue increased by 8.4% YoY to AED 519.9 million in Q3 2026, driven by growth in the UAE, Middle East and India. Strong project demand and constrained imports supported sales in the UAE and Middle East. Continued investment in product innovation and manufacturing technology supported portfolio enhancement and operating efficiency. Sanitaryware: Revenue declined by 7.3% YoY to AED 114.8 million in Q3 2026. Growth in GCC markets partly offset weaker sales in other markets. The KLUDI-branded Sanitaryware is further driving growth by catering to premium projects. Faucets (KLUDI): Revenue declined by 3.2% YoY to AED 114.5 million in Q3 2026. Growth in the UAE and Middle East partly offset weaker sales in Europe and other export markets, where operations were impacted by component delivery delays from China. The Group remains committed to improving KLUDI’s operational performance and is progressing with the cost-optimization strategy. Tableware: Revenue declined by 11.0% YoY to AED 75.5 million in Q3 2026, as weaker regional hospitality demand outweighed growth in aviation and the Americas. Cookplay integration, premium partnerships and aviation accounts remain priorities to support recovery. Tiles & Sanitaryware market highlights The UAE market remained strong in Q3 2026, with revenue rising 32.5% YoY to AED 313.8 million driven by robust construction activity, project sales and slab demand, while import disruptions supported market share gains. In Saudi Arabia, revenue decreased by 17.2% YoY in Q3 2026 to AED 43.0 million, mainly due to SABER approval delays affecting deliveries. The Yanbu Greenfield Tiles Project remains on track for Q2 2027 completion, supporting future capacity and cost competitiveness. In Europe, revenue declined by 19.9% YoY to AED 68.2 million in Q3 2026, impacted by higher logistics costs, market competition and shipment delays, while inventory buffers helped maintain service levels. In India, revenue increased by 12.0% YoY to AED 92.8 million in Q3 2026, supported by dealer network expansion. Continued investment in retail expansion and showroom upgrades is expected to strengthen market presence and profitability. In Bangladesh, revenue declined by 11.7% YoY to AED 54.7 million in Q3 2026 impacted by gas shortages. Targeted value creation initiatives are underway to strengthen market share. In the Middle East, revenue increased 38.0% YoY to AED 41.6 million in Q3 2026, supported by market share gains and constrained imports. The Group continued to strengthen GCC sales channels and expand its customer base. Q3 25 Q2 26 9M 2025Amount in AED M Amount Amount AmountYoY GrowthQoQ GrowthAmount AmountYoY GrowthRevenue 824.9 822.8861.54.4% 4.7% 2,428.22,445.10.7%Gross margin (%) 40.5% 41.0%40.3%-0.1% -0.7% 40.3%40.3%0.0%EBITDA 167.9 157.5175.74.7% 11.5% 464.3460.5-0.8%Profit before tax 86.6 85.798.313.4% 14.6% 237.8237.0-0.4%Profit after tax 67.5 68.378.015.5% 14.1% 182.7184.51.0%Capital expenditure 59.4 57.362.45.1% 8.9% 215.6162.5-24.6%Net debt 1,638.3 1,515.31,587.2-3.1% 4.7% 1,638.31,587.2-3.1%Net debt / EBITDA 2.63x 2.48x2.56x-0.05x 0.08x 2.63x2.56x-0.07x Quarterly comparisonYearly ComparisonQ3 26 9M 2026
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R.A.K Ceramics P.J.S.C. and its subsidiaries Condensed consolidated interim financial information for the nine months period ended 30 September 2026
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R.A.K Ceramics P.J.S.C. and its subsidiaries Condensed consolidated interim financial information 30 September 2026 Contents Page Independent auditor’s review report 1 – 2 Condensed consolidated statement of profit or loss 3 Condensed consolidated statement of profit or loss and other comprehensive income 4 Condensed consolidated statement of financial position 5 Condensed consolidated statement of cash flows 6 – 7 Condensed consolidated statement of changes in equity 8 – 9 Notes to the condensed consolidated interim financial information 10 – 41
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KPMG Lower Gulf Limited B01153B3, New Service Block - Al Hulaila FZ Al Hulaila Industrial Free Zone Ras Al Khaimah, United Arab Emirates Tel. +971 (4) 403 0300, www.kpmg.com/ae ©2026 KPMG Lower Gulf Limited, licensed in the United Arab Emirates and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. KPMG Lower Gulf Limited (Branch) is registered and licensed under the rules and regulations of Ras Al Khaimah Economic Zone. 1 To the Shareholders of R.A.K Ceramics P.J.S.C Introduction We have reviewed the accompanying 30 September 2026 condensed consolidated interim financial information of R.A.K Ceramics P.J.S.C (the Company) and its subsidiaries (the Group), consisting of: the condensed consolidated statements of profit or loss for the nine-month and three-month periods ended 30 September 2026; the condensed consolidated statements of profit or loss and other comprehensive income for the nine-month and three-month periods ended 30 September 2026; the condensed consolidated statement of financial position as at 30 September 2026; the condensed consolidated statement of cash flows for the nine-month period ended 30 September 2026; the condensed consolidated statement of changes in equity for the nine-month period ended 30 September 2026; and notes to the condensed consolidated interim financial information. Management is responsible for the preparation and presentation of this condensed consolidated interim financial information in accordance with IAS 34, Interim Financial Reporting. Our responsibility is to express a conclusion on this condensed consolidated interim financial information based on our review.
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©2026 KPMG Lower Gulf Limited, licensed in the United Arab Emirates and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. KPMG Lower Gulf Limited (Branch) is registered and licensed under the rules and regulations of Ras Al Khaimah Economic Zone. 2 R.A.K Ceramics P.J.S.C Independent Auditors Report on Review of Condensed Consolidated Interim Financial Information 30 September 2026 Scope of Review We conducted our review in accordance with the International Standard on Review Engagements 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of condensed consolidated interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believe that the accompanying 30 September 2026 condensed consolidated interim financial information is not prepared, in all material respects, in accordance with IAS 34, Interim Financial Reporting. KPMG Lower Gulf Limited Richard Ackland Registration No.: 1015 Ras Al Khaimah, United Arab Emirates Date:
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R.A.K Ceramics P.J.S.C. and its subsidiaries Condensed consolidated statement of profit or loss For the nine months period ended 30 September 2026 3 Nine months period ended 30 September Three months period ended 30 September 2026 2025* 2026 2025* Notes AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Revenue 5 2,445,052 2,428,200 861,544 824,917 Cost of sales 6 (1,460,367) (1,450,229) (513,939) (490,924) Gross profit 984,685 977,971 347,605 333,993 Administrative and general expenses 7 (189,858) (174,445) (62,434) (60,603) Selling and distribution expenses 8 (525,227) (533,912) (180,697) (176,896) Impairment loss on financial assets 7(i) (10,997) (19,729) (312) (4,897) Loss on net monetary position 26 (3,659) (1,916) (2,844) (1,447) Net foreign exchange gain - 3,360 - (2,030) Net foreign exchange loss (9,638) - (5,670) - Net change in fair value of derivatives 7,274 (831) 4,724 5,146 Other operating income 9 37,037 37,214 15,278 12,370 Operating profit 289,617 287,712 115,650 105,636 Share of (loss)/ profit in equity accounted investees 11 (455) 408 (860) 260 Income from investment properties 31,545 33,556 10,354 10,593 Other income on investment properties 2,857 - 2,857 - Finance income 10 1,727 3,296 515 630 Operating and maintenance expenses of investment properties (5,996) (4,592) (1,693) (1,632) Depreciation on investment properties (8,586) (9,730) (2,887) (3,343) Gain on sale of investment properties 1,265 5,458 - 957 Profit before financing and income tax 311,974 316,108 123,936 113,101 Finance cost 10 (74,985) (78,276) (25,669) (26,482) Profit before income tax 236,989 237,832 98,267 86,619 Tax expense 12 (52,502) (55,097) (20,308) (19,119) Net profit for the period 184,487 182,735 77,959 67,500 Profit attributable to: Owners of the Company 179,544 178,752 77,334 66,884 Non-controlling interests 4,943 3,983 625 616 Profit for the period 184,487 182,735 77,959 67,500 Earnings per share - basic and diluted (AED) 13 0.181 0.180 0.078 0.067 * The Group has early adopted IFRS 18 Presentation and Disclosure in Financial Statements with effect from 1 January 2026. Accordingly, the previous period numbers are re -grouped for the purpose of presentation and disclosures. (Refer note 32). The accompanying notes form an integral part of the condensed consolidated interim financial information.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Condensed consolidated statement of profit or loss and other comprehensive income For the nine months period ended 30 September 2026 4 Nine months period ended 30 September Three months period ended 30 September 2026 2025* 2026 2025* AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Net profit for the period 184,487 182,735 77,959 67,500 Other comprehensive income Items that may be reclassified subsequently to profit or loss Foreign exchange differences on translation of foreign operations (25,647) (51,109) (21,962) (3,264) Cash flow hedges – effective portion of changes in fair value loss on hedging instruments 408 (129) 174 70 Cash flow hedges – effective portion of changes in fair value loss on hedging instruments – reclassified to profit and loss (1,412) (3,166) (483) (930) Effects of application of hyperinflation accounting (Note 26) 47,355 14,923 23,056 7,079 Total comprehensive income for the period 205,191 143,254 78,744 70,455 Total comprehensive income attributable to: Owners of the Company 201,739 141,525 78,206 70,041 Non-controlling interest 3,452 1,729 538 414 Total comprehensive income for the period 205,191 143,254 78,744 70,455 * The Group has early adopted IFRS 18 Presentation and Disclosure in Financial Statements with effect from 1 January 2026. Accordingly, the previous period numbers are re -grouped for the purpose of presentation and disclosures. (Refer note 32). The accompanying notes form an integral part of the condensed consolidated interim financial information.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Condensed consolidated statement of cash flows For the nine months period ended 30 September 2026 6 Nine months period ended 30 September 2026 2025* AED’000 AED’000 (unaudited) (unaudited) Operating activities Operating profit for the period 289,617 287,712 Adjustments for: Depreciation of property, plant and equipment 120,780 121,210 Amortisation of intangible assets 2,868 3,808 Depreciation of right-of-use assets 29,114 29,108 Gain on disposal of property, plant and equipment (5,418) (3,621) Provision for employees’ end-of-service benefits 13,099 20,758 Loss on net monetary position 3,659 1,916 Allowance for slow moving and obsolete inventories 28,042 32,911 Write-down of cost of finished goods (11,304) 10,356 Impairment loss on trade receivables 10,997 10,074 Impairment loss on non-trade receivables - 9,655 481,454 523,887 Changes in: - Inventories 47,482 (140,838) - trade and non-trade receivables (including long-term portion) (42,015) (48,781) - due from related parties (694) (3,895) - trade and non-trade payables (36,447) (15,583) - due to related parties (7,811) 13,011 Income tax paid (68,000) (40,162) Employees’ end-of-service benefits paid (9,847) (16,448) Net cash generated from operating activities 364,122 271,191 Investing activities Additions to property, plant and equipment (162,457) (215,557) Proceeds from disposal of property, plant and equipment 12,459 6,210 Additions to intangible assets (914) (6,001) Proceeds from sale of investment properties 2,040 9,021 Dividend received from equity accounted investees 432 500 Interest received 1,727 3,296 Cash paid for acquisition of subsidiary (5,686) - Additional bank deposits made with an original maturity of more than three months (21,122) (7,118) Proceeds on maturity of bank deposits with an original maturity of more than three months 20,326 4,593 Net cash used in investing activities (153,195) (205,056)
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R.A.K Ceramics P.J.S.C. and its subsidiaries Condensed consolidated statement of cash flows (unaudited) (continued) For the nine months period ended 30 September 2026 7 Nine months period ended 30 September 2026 2025* AED’000 AED’000 (unaudited) (unaudited) Financing activities Long-term bank financing availed 53,735 98,575 Long-term bank financing repaid (143,435) (141,631) Long-term Islamic bank financing availed 150,000 128,952 Long-term Islamic bank financing repaid (101,493) (86,121) Repayment of lease liabilities (33,889) (31,347) Short-term bank financing availed 1,020,619 827,597 Short-term bank financing repaid (960,962) (668,028) Short-term Islamic bank financing availed 242,446 275,740 Short-term Islamic bank financing repaid (219,903) (214,072) Interest paid (44,880) (50,302) Profit paid on Islamic bank financing (19,820) (17,838) Loan repaid to related parties (1,596) - Dividend paid (198,741) (198,741) Dividend paid to non-controlling interests (14,189) (12,132) Net cash used in financing activities (272,108) (89,348) Net decrease in cash and cash equivalents (61,181) (23,213) Cash and cash equivalents at the beginning of the period 127,198 129,050 Foreign exchange difference on cash and cash equivalents 6,319 (2,524) Net cash and cash equivalents at the end of the period 72,336 103,313 Represented by: Cash and cash equivalents (refer Note 21) 138,990 166,898 Bank overdrafts (refer Note 23b(i)) (66,654) (63,585) 72,336 103,313 * The Group has early adopted IFRS 18 Presentation and Disclosure in Financial Statements with effect from 1 January 2026. Accordingly, the previous period numbers are re -grouped for the purpose of presentation and disclosures. (Refer note 32). The accompanying notes form an integral part of the condensed consolidated interim financial information.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Condensed consolidated statement of changes in equity for the nine months period ended 30 September 2026 8 Share capital Share premium Legal reserve Translation reserve Hyper-inflation reserve* Hedging reserve AED’000 Non distributable reserve** AED’000 Retained earnings AED’000 Total reserves AED’000 Total Non-controlling interests (NCI) Total equity AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 Balance at 1 January 2026 993,703 165,000 496,852 (230,980) (158,497) 1,604 131,707 844,923 1,250,609 2,244,312 85,251 2,329,563 Total comprehensive income for the period (unaudited) Net profit for the period - - - - - - - 179,544 179,544 179,544 4,943 184,487 Other comprehensive income Foreign exchange differences on translation of foreign operations 8,233 (32,389) (24,156) (24,156) (1,491) (25,647) - - - - - - Changes in cash flow hedges - - - - - (1,004) - - (1,004) (1,004) - (1,004) Effects of application of IAS 29 (refer Note 26) - - - - 47,355 - - - 47,355 47,355 - 47,355 Total comprehensive income for the period (unaudited) - - - 8,233 14,966 (1,004) - 179,544 201,739 201,739 3,452 205,191 Other equity movements (unaudited) Transaction with owners Acquisition of NCI - - - - - - - 587 587 587 (587) - Dividend paid (refer Note 22(i)) - - - - - - - (198,741) (198,741) (198,741) - (198,741) Dividend paid to NCI - - - - - - - - - - (14,189) (14,189) Balance at 30 September 2026 (unaudited) 993,703 165,000 496,852 (222,747) (143,531) 600 131,707 826,313 1,254,194 2,247,897 73,927 2,321,824 * The hyperinflation reserve comprises of foreign currency differences arising from the translation of the financial statements of RAK Ceramics (PJSC) Limited, Iran and the effect of translating the financial statements at the corresponding inflation in dex in accordance with IAS 29: Financial Reporting in Hyperinflationary Economies. ** Non-distributable reserve includes (i) the Group’s share worth AED 56.7 million in the share premium of its subsidiary in Banglad esh, and (ii) the Group’s share of retained earnings worth AED 75.0 million of the retained earnings capitali sed by certain Group subsidiaries through issuance of bonus shares from time to time. The accompanying notes form an integral part of the condensed consolidated interim financial information.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Condensed consolidated statement of changes in equity (continued) for the nine months period ended 30 September 2026 9 Share capital Share premium Legal reserve Translation reserve Hyper-inflation reserve* Hedging reserve Non distributable reserve** Retained earnings Total reserves Total Non-controlling interests (NCI) Total equity AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 Balance at 1 January 2025 993,703 221,667 496,852 (203,683) (153,419) 5,599 75,040 799,948 1,242,004 2,235,707 95,335 2,331,042 Total comprehensive income for the period (unaudited) Net profit for the period - - - - - - - 178,752 178,752 178,752 3,983 182,735 Other comprehensive income Foreign exchange differences on translation of foreign operations - - - (26,887) (21,968) - - - (48,855) (48,855) (2,254) (51,109) Changes in cash flow hedges - - - - - (3,295) - - (3,295) (3,295) - (3,295) Effects of application of IAS 29 (refer Note 26) - - - - 14,923 - - - 14,923 14,923 - 14,923 Total comprehensive income for the period (unaudited) - - - (26,887) (7,045) (3,295) - 178,752 141,525 141,525 1,729 143,254 Other equity movements (unaudited) Transfer to retained earnings - - - - - - - - - - - - Transaction with owners (unaudited) Dividend paid (refer Note 22(i)) - - - - - - - (198,741) (198,741) (198,741) - (198,741) Dividend paid to NCI - - - - - - - - - - (12,132) (12,132) Balance at 30 September 2025 (unaudited) 993,703 221,667 496,852 (230,570) (160,464) 2,304 75,040 779,959 1,184,788 2,178,491 84,932 2,263,423 * The hyperinflation reserve comprises of foreign currency differences arising from the translation of the financial statements of RAK Ceramics (PJSC) Limited, Iran and the effect of translating the financial statements at the corresponding inflation in dex in accordance with IAS 29: Financial Reporting in Hyperinflationary Economies. ** Non-distributable reserve includes (i) the Group’s share worth AED 56.7 million in the share premium of its subsidiary in Banglad esh, and (ii) the Group’s share of retained earnings worth AED 75.0 million of the retained earnings capitali sed by certain Group subsidiaries through issuance of bonus shares from time to time. The accompanying notes form an integral part of the condensed consolidated interim financial information.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information for the nine months period ended 30 September 2026 10 1. General information R.A.K Ceramics P.J.S.C. (the “Company" or the “Holding Company”) was incorporated under Emiri Decree No. 6/89 dated 26 March 1989 as a limited liability company in the Emirate of Ras Al Khaimah, UAE. Subsequently, under Emiri Decree No. 9/91 dated 6 July 1 991, the legal status of the Company was changed to a Public Shareholding Company. The registered address of the Company is P.O. Box 4714, Al Jazeerah Al Hamra City, Ras Al Khaimah, United Arab Emirates. The Company is listed on Abu Dhabi Securities Exchange, UAE. The condensed consolidated interim financial information as at and for the nine months period ended 30 September 2026 comprises the financial information of the Company and its subsidiaries (collectively referred to as the “Group” and individually as “Group entities”) and the Group’s interest in equity accounted investees. The principal activities of the Group are the manufacturing and sale of a variety of ceramic products including tiles, bathroom sets, sanitary wares, table wares and faucets. The Company and certain Group entities are also engaged in investing in other entities; within the UAE as well as globally, that undertake similar or ancillary activities. Accordingly, the Company also acts as a Holding Company of the Group entities. The Group is also engaged in contracting and other industrial manufacturing activities. 2. Application of new and revised Financial Reporting Standards (“IFRS accounting standards”) The accounting policies used in the preparation of the condensed consolidated interim financial information are consistent with those used in the preparation of the Group’s annual consolidated financial statements for the year ended 31 December 2025, and the notes attached thereto, except for the adoption of certain new and revised standards, that became effective in the current period as set out below. 2.1 New and revised IFRSs Accounting Standards adopted by the Group In the current financial period, the Group has applied the following amendments to IFRS Accounting Standards issued by the International Accounting Standards Board (“IASB”) that are mandatorily effective for an accounting period that begins on or after 1 January 202 6. The application of these amendments to IFRS Accounting Standards has not had any material impact on the amounts reported for the current period but may affect the accounting for the Group’s future transactions or arrangements. • Amendments to IFRS 7 & IFRS 9 on Financial Instruments with ESG -linked features, Classification and measurement of ESG -linked loans and bonds (e.g., interest rates tied to sustainability targets). (Effective Date: 1 January 2026). • Annual Improvements to IFRS Accounting Standards — Volume 11 (effective on or after 1 January 2026): IFRS 1: Hedge accounting by a first-time adopter IFRS 7: Gain or loss on de-recognition IFRS 7: Disclosure of deferred difference between fair value and transaction price IFRS 7: Credit risk disclosures IFRS 9: Lessee de-recognition of lease liabilities IFRS 9: Transaction price IFRS 10: Determination of a ‘de facto agent’ IAS 7: Cost method
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 11 2. Application of new and revised Financial Reporting Standards (“IFRS accounting standards”) (continued) 2.1 New and revised IFRSs Accounting Standards adopted by the Group (continued) • IFRS 18 Presentation and disclosures in financial statements - The new standard contains requirements for all entities applying IFRS for the presentation and disclosure of information in financial statements (effective 1 January 2027). The Group has early adopted with effect from 1 January 2026. Other than the above, there are no significant IFRS Accounting Standards and amendments that were effective for the first time for the financial year beginning on or after 1 January 202 6. 2.2 New and revised IFRSs Accounting Standards in issue but not yet effective and not early adopt The Group has not early adopted the following new and revised IFRS Accounting Standards that have been issued but are not yet effective: • IFRS 19 subsidiaries without Public Accountability: Disclosures – the new standard specifies reduced disclosure requirements to eligible entities instead of full disclosure requirements in other standards (effective 1 January 2027). • Amendments to IFRS 10 ‘Consolidated Financial Statements’ and IAS 28 ‘Investments in Associates and Joint Ventures’ (2011) relating to the treatment of the sale or contribution of assets from an investor to its associate or joint venture (effective date deferred indefinitely, early adoption permitted). • IFRS 20 requires an entity that is subject to a regulatory agreement to provide information about its regulatory assets, regulatory liabilities, regulatory income and regulatory expense. IFRS 20 is effective for annual reporting periods beginning on or after 1 January 2029. • IFRS for SMEs - Major update to align SME (Small & Medium Enterprises) reporting with key principles of: IFRS 15 – Revenue from Contracts, IFRS 13 – Fair Value, and IFRS 3 – Business Combinations (effective 1 January 2027, early adoption allowed from 2025) 3. Summary of material accounting policies Basis of preparation The condensed consolidated interim financial information has been prepared in accordance with International Accounting Standard (“IAS”) No. 34 ‘Interim Financial Reporting’. The condensed consolidated interim financial information is presented in U.A.E. Dirhams (AED) since that is the currency in which the majority of the Group’s transactions are denominated and all values are rounded to the nearest thousand (AED ‘000) except when otherwise indicated. The condensed consolidated interim financial information has been prepared on the historical cost basis, except for the revaluation of certain financial instruments. The accounting policies, presentation and methods in the condensed consolidated interim financial information are consistent with those used in the audited annual consolidated financial statements for the year ended 31 December 2025, except for the early adoption of IFRS 18 with effect from 1 January 2026.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 12 3. Summary of material accounting policies (continued) Basis of preparation (continued) The condensed consolidated interim financial information does not include all the information required for annual consolidated financial statements and should be read in conjunction with the Group’s audited annual consolidated financial statements as at an d for the year ended 31 December 202 5. No income of a seasonal nature was recorded in the condensed consolidated statement of profit or loss for the nine months period ended 30 September 2026 and 2025. In addition, results for the nine months period ended 30 September 2026 are not necessarily indicative of the results that may be expected for the financ ial year ending 31 December 2026. 4. Changes in judgements and estimation uncertainty The critical judgements and estimates used in the preparation of the condensed consolidated interim financial information are consistent with those used in the preparation of the Group’s audited annual consolidated financial statements for the year ended 31 December 2025. 5. Revenue Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Sale of goods 2,439,757 2,423,876 860,322 822,458 Supply of services 5,295 4,324 1,222 2,459 2,445,052 2,428,200 861,544 824,917 The Group derives its revenue from contracts with customers for transfer of goods at a point in time.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 13 6. Cost of sales Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Raw materials consumed 691,020 726,641 256,002 246,104 Direct labor 188,309 209,183 63,053 71,423 LPG and natural gas 102,574 98,029 40,867 31,204 Depreciation of property, plant and equipment 95,334 98,516 31,534 35,830 Power and fuel 94,863 105,552 32,353 36,294 Repairs and maintenance expense 88,077 91,335 33,948 33,580 Packing material expenses 70,156 71,669 27,680 24,588 Allowance for slow moving inventories 28,042 32,911 8,263 12,267 Insurance 4,934 7,783 2,342 4,647 Hire charges on machinery and equipment 2,899 141 2,279 49 Clearing charges on trading goods 1,730 3,299 925 2,204 Amortisation of intangible assets 606 673 214 212 Depreciation of right-of-use assets 366 419 117 135 Change in inventory of finished goods 38,540 (29,065) (3,840) (6,329) Other production expenses* 52,917 33,143 18,202 (1,284) 1,460,367 1,450,229 513,939 490,924 * Other production expenses include research, development, waste disposal, travelling, telephone etc, across all subsidiaries of the Group.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 14 7. Administrative and general expenses Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Staff salaries and associated costs 97,747 92,228 30,722 33,452 Legal and professional fees 18,709 9,811 6,895 2,884 Information technology licenses and consultancy expenses 15,543 13,845 5,366 4,946 Depreciation of property, plant and equipment 11,616 9,004 3,841 3,070 Repairs and maintenance expenses 6,729 6,218 2,447 2,475 Telephone, postal and office supplies 4,974 4,754 2,160 1,647 Utility expenses 3,997 4,195 1,382 1,614 Directors’ remuneration 2,775 2,775 925 925 Insurance 2,681 3,130 1,128 725 Rental charges 2,614 2,652 839 768 Amortisation of intangible assets 2,262 3,135 639 1,085 Security charges 1,469 1,094 287 478 Vehicles and equipment hire charges 1,163 1,082 345 356 Depreciation of right-of-use assets 646 596 208 212 Travelling expense 592 666 252 106 Other administrative expenses* 16,341 19,260 4,998 5,860 189,858 174,445 62,434 60,603 * Other administrative expenses include fire, safety, environmental, licenses, certifications, training expenses etc. across all subsidiaries of the Group. 7(i) Impairment loss /(reversal) on financial assets Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Impairment loss on trade receivables 10,997 10,074 931 2,367 Impairment loss on non- trade receivables - 9,655 (619) 2,530 10,997 19,729 312 4,897
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 15 8. Selling and distribution expenses Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Staff salaries and associated costs 197,510 191,054 64,067 63,714 Freight and transportation 172,122 175,227 65,517 55,889 Advertisement and promotions expense 47,030 57,886 13,843 16,860 Depreciation of right-of-use assets 28,102 28,093 9,281 9,603 Agents’ commission 20,854 22,326 7,347 7,477 Depreciation of property, plant and equipment 13,830 13,690 4,668 4,707 Rental expenses 7,282 4,201 3,515 1,356 Travel and entertainment expenses 4,479 5,782 1,228 1,186 Repairs, maintenance & consumables 2,427 2,359 888 1,016 Royalty 1,980 1,980 960 960 Telephone & office supplies 820 841 246 257 Postal, courier charge and stationary 169 266 32 66 Other selling expenses* 28,622 30,207 9,105 13,805 525,227 533,912 180,697 176,896 * Other selling expenses include inspection, certifications, customer claims, insurance, equipment hire charges etc. across all subsidiaries of the Group. 9. Other operating income Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Provisions written back 12,373 12,095 9,217 1,119 Net gain on disposal of property, plant and equipment 5,418 3,621 (98) 889 Sale of scrap and miscellaneous items 4,482 3,675 1,027 932 Discounts earned on purchases and freight 3,038 4,199 1,640 359 Government grant 1,956 - - - Insurance claims 544 455 210 155 Duty drawback 172 226 79 83 Other operating income 9,054 12,943 3,203 8,833 37,037 37,214 15,278 12,370 * Other operating income include sales related services, design services, documentation services etc. across all subsidiaries of the Group.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 16 10. Finance costs and income Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Finance costs Interest on bank financing 44,728 50,084 15,319 17,162 Profit expense on Islamic bank financing 19,820 17,838 7,025 6,119 Interest expense on lease liabilities 5,924 6,874 2,135 2,231 Bank charges 4,361 3,262 1,161 897 Interest on amount due to related parties 152 218 29 73 Total (A) 74,985 78,276 25,669 26,482 Finance income Interest on bank deposits 1,727 3,296 515 630 Total (B) 1,727 3,296 515 630 Net finance costs (A-B) 73,258 74,980 25,154 25,852 11. Investments in equity accounted investees The Group’s share of loss in equity accounted investees for the nine months period ended 30 September 2026 amounted to AED 0.45 million (unaudited) (nine months period ended 30 September 2025 (unaudited): share of profit AED 0.40 million). The Group has received AED 0.40 million as dividends during the current period from its equity accounted investees (nine months period ended 30 September 2025 (unaudited) AED 0.50 million). 12. Corporate Income Tax Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Current tax In respect of current period 39,050 41,536 14,739 14,266 DMTT 16,114 15,634 6,174 5,641 Deferred tax Reversal of temporary tax differences during the period (2,662) (2,073) (605) (788) Tax expense for the year 52,502 55,097 20,308 19,119
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 17 12. Corporate Income Tax (continued) 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Provision for tax 70,655 84,006 Deferred tax liabilities 14,343 16,637 Deferred tax assets 3,635 3,783 Effective 1 January 2025, the UAE introduced the Domestic Minimum Top -up Tax (DMTT) as part of the implementation of the OECD’s Pillar Two global tax framework. The Group falls within the scope of the DMTT regime based on the applicable revenue threshold a nd has recogni sed additional current income tax expense to ensure compliance with the 15% global minimum effective tax rate (ETR) requirement. For the nine -month period ended 30 September 2026, the Group recognised an amount of AED 16.1 1 million in current income tax expense relating to the DMTT (nine-month period ended 30 Septembe r 2025 of AED 15.63 million), specifically for UAE -based subsidiaries. The inclusion of DMTT has contributed to an increase in the consolidated effective tax rate (ETR), which is 22.1 5% for the nine - month period ended 30 September 2026 (nine -month period e nded 30 September 2025: (23.16 %). Excluding the impact of DMTT, the underlying ETR is 15.3 5% for the nine -month period ended 30 September 2026 (nine-month period ended 30 September 2025: 16.59%) 13. Earning per share Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Profit attributable to the owners of the Company (AED’000) 179,544 178,752 77,334 66,884 Weighted average number of ordinary shares (‘000s) 993,703 993,703 993,703 993,703 Basic and diluted earnings per share (AED) 0.181 0.180 0.078 0.067 There was no dilution effect on the basic earnings per share as the Company does not have any such outstanding share commitments as at the reporting date. 14. Property, plant and equipment Additions, disposals and depreciation (unaudited) During the nine months period ended 30 September 2026, the Group acquired property, plant and equipment and made additions to capital work in progress amounting to AED 162.5 million (nine months period ended 30 September 2025: AED 215.6 million). Property, plant and equipment with a carrying amount of AED 8.9 million was disposed during the nine months period (nine months period ended 30 September 2025: AED 2.6 million) resulting in a gain on disposal of AED 5.4 million (gain on disposal, nine months period ended 30 September 2025 : AED 3.6 million) which is included in other operating income in the condensed consolidated statement of profit or loss. Borrowings are secured against certain property, plant and equipment.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 18 14. Property, plant and equipment (continued) Depreciation of property, plant a nd equipment for the nine months period amounted to AED 120.7 million (nine months period ended 30 September 2025: AED 121.2 million). Below is the breakdown of property, plant and equipment inside and outside the U.A.E: 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Inside U.A.E 1,046,888 1,055,028 Outside U.A.E 416,748 377,478 1,463,636 1,432,506 15. Goodwill 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Opening balance 124,925 120,122 Goodwill recognised during the year 14,671 4,462 Effects of movements in exchange rate (224) 341 Closing balance 139,372 124,925 As at 30 September 2026 , Goodwill comprises AED 50.4 million, AED 5 .5 million, AED 5.9 million, AED 58.5 million, AED 4.4 million, AED 14.6 millio n recognised on acquisition of Ceramin FZ LLC, UAE, distribution entities in UK, Italy, Saudi Arabia, Spain and newly acquired entity, Tebra Al Arabia in Saudi respectively (refer note 27). During the period, management performed sensitivity analysis over the key assumptions used in determining the recoverable amount s of the cash-generating unit s to which goodwill is al located and concluded that no impairment is required against Goodwill.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 19 16. Investment properties Inside UAE Outside UAE Total 30 September 31 December 30 September 31 December 30 September 31 December 2026 2025 2026 2025 2026 2025 (unaudited) (audited) (unaudited) (audited) (unaudited) (audited) AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 Land Net book value 708,840 708,840 15,000 15,085 723,840 723,925 Fair value 708,840 708,840 18,464 18,464 727,304 727,304 Building Net book value 162,515 162,896 15,603 9,753 178,118 172,649 Fair value 385,707 377,707 21,625 21,625 407,332 399,332 Total Net book value 871,355 871,736 30,603 24,838 901,958 896,574 Total Fair value 1,094,547 1,086,547 40,089 40,089 1,134,636 1,126,636
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 20 16. Investment properties (continued) Investment properties comprise land and buildings that are located in the United Arab Emirates, Bangladesh, Lebanon and Iran. During the period additions to investment properties amounted to AED 8 million pertained to acquisition of property in settlement of old receivables through the court order. Depreciation during the period amounted to AED 46 thousand. The fair value of the Group’s investment properties as at 31 December 2025 (audited) amounted to AED 1,126.64 million and was arrived at on the basis of valuations carried out by external valuers who have appropriate market experience in the valuation of properties. Management has assessed the impact of ongoing geopolitical developments and prevailing market conditions on the valuation of the Group’s investment properties and concluded that the key valuation assumptions and estimates applied as at 31 December 2025 remain appropriate as at 30 September 2026. Management based on their discussion with the independent external valuer is of the view that the current geopolitical environment may influence market sentiment, investor appetite, and the timing of development decisions. For land assets, particularly those of significant scale, these factors are typically reflected through changes in absorption assumptions, development phasing, and required returns rather than through immediate shifts in headline land values. At present, for land asset in UAE, management is of the view that no sufficient transactional evidence have been observed within the Ras Al Khaimah land market to support a definitive adjustment to underlying land values. Market activity, particularly for large-scale waterfront development plots, remains relatively limited, and there have been no recent arm’s length transactions of a comparable nature that would provide a clear basis for revising benchmark land rates. Based on the assessment performed, management determined that there has been no mater ial change in the fair value of the invest ment properties during the nine -month period ended 30 September 2026. Management continues to closely monitor evolving geopolitical and macroeconomic conditions and will assess the potential impact on the Group’s financial position and asset valuations, if any. The fair value measurement has been categori sed as a Level 3 fair value based on the inputs to the valuation technique used and in estimating the fair value, the highest and best use of the properties in their current use (31 December 2025: Level 3). 17. Trade and non-trade receivables 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Trade receivables 942,281 887,228 Less: Allowance for expected credit loss (130,238) (123,017) Subtotal (A) 812,043 764,211 Non-trade receivables 136,192 129,154 Less: Allowance for expected credit loss (92,829) (96,368) Subtotal (B) 43,363 32,786 Advances and prepayments (C) 142,634 138,755 Deposits (D) 30,774 32,261 Total (A+B+C+D) 1,028,814 968,013
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 21 17. Trade and non-trade receivables (continued) (i) Long-term receivables 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Trade receivables 88,479 107,978 Less: Allowance for expected credit loss (33,147) (28,017) 55,332 79,961 Less: current portion included in trade receivables (16,141) (24,670) Long-term trade receivables (A) 39,191 55,291 Non-trade receivables 823 2,284 Long-term non-trade receivables (B) 823 2,284 Long-term receivables (A+B) 40,014 57,575 18. Inventories 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Finished goods (net of net realizable value adjustments) 1,023,945 1,029,513 Less: Allowance for slow moving inventories (148,271) (133,834) Subtotal (A) 875,674 895,679 Raw materials 229,633 238,738 Stores and spares 342,863 332,188 572,496 570,926 Less : Allowance for slow-moving inventories (115,458) (109,386) Subtotal (B) 457,038 461,540 Goods-in-transit (C) 11,266 34,068 Work-in-progress (D) 48,417 52,945 Total (A+B+C+D) 1,392,395 1,444,232 At 30 September 2026, the Group recognised a cumulative loss due to write -down of finished goods inventories of AED 107.4 million against cost of AED 696.6 million (31 December 2025 (audited): AED 119.4 million against cost of AED 408.9 million) to bring it t o its net realizable value which was lower than the cost. The difference in the write down of AED 12.0 million (unaudited) (nine months period ended 30 September 2025 (unaudited): AED 10.3 million) is included in cost of sales in the condensed consolidated statement of profit or loss with a currency loss of AED 0.7 million for the period (unaudited) (nine months period ended 30 September 2025 (unaudited): AED 0.2 million). Certain inventories are subject to a charge in favour of banks against facilities obtained by the Group.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 22 19. Related party balances and transactions The Group, in the normal course of business, enters into transactions with individuals and other entities that fall within the definition of related party as per IAS 24. The transactions of the Group with its related parties are at arm’s length. The related parties include equity accounted investees and the parties where members of the board or key management personnel have interest and can exercise control or significant influence. The significant transactions entered into by the Group with related parties during the period, other than those disclosed elsewhere in this condensed consolidated interim financial information are as follows: Transactions with related parties (A) Equity accounted investees Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Sale of goods and services 2,767 1,457 707 221 Royalty 345 240 109 32 (B) Other related parties Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Sale of goods and services 86,978 89,331 21,174 33,523 Purchase of goods and rendering of services 126,951 110,237 48,718 38,427 Interest expense (refer note 10) 152 218 29 73 Key management personnel compensation The remuneration of Directors and other key management personnel of the Group during the period were as follows: Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Short-term benefits 8,267 9,936 2,756 3,312 Staff terminal benefits 161 175 54 58 Board of Directors’ remuneration accrued (Refer note 7) 2,775 2,775 925 925 Board of Directors’ remuneration paid (Refer note 7) 3,700 3,700 - -
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 23 19. Related party balances and transactions (continued) (B) Other related parties (continued) Due from related parties 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Equity accounted investees 6,199 6,178 Other related parties 62,933 61,725 69,132 67,903 Less : Allowance for expected credit loss (5,074) (4,539) 64,058 63,364 Due to related parties Long-term loan 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Other related parties 1,408 3,004 1,408 3,004 Current liabilities 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Other related parties * 56,807 64,618 56,807 64,618 Carrying amount of due to related parties subject to supplier finance arrangement 30 September 2026 31 December 2025 AED’000 AED’000 Presented within due to related parties 50,839 60,556 - of which supplier has received the payment from the bank 27,052 48,620 Range of payment due dates Due to related parties subject to supplier finance arrangement (days after invoice date) 140-160 140-150 * In order to ensure easy access to credit for its suppliers, the Group has entered into reverse factoring arrangements. Due to related parties include AED 50.8 million (31 December 2025: AED 60.5 million) owed under this arrangement.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 24 19. Related party balances and transactions (continued) (B) Other related parties (continued) Due to related parties (continued) Current liabilities (continued) In order to facilitate efficient payment processing as well as facilitating payment to suppliers, the Group participates in a supplier finance arrangement under which its suppliers elect to receive early payment of their invoices from the bank. The bank ag rees to pay the underlying amount to the suppliers and the Group pays the bank at an agreed date later. This arrangement does not result in any material extension of initially agreed payment term with the suppliers. All payables under this arrangement are classified due to related parties at the balance sheet date as payment to the supplier by the banks does not release the Group from its legal liability to the suppliers. The Group has not derecogni sed the original due to related parties relating to the arrangement because neither a legal release was obtained nor was the original liability substantially modified on entering into the arrangement . 20. Derivative financial instruments The Group uses derivative financial instruments for risk management purposes. The Group classifies interest rate swaps as cash flow hedges in accordance with the recognition criteria of IFRS 9, as it is mitigating the risk of cash flow variations due to movements in interest rates and commodity prices. The table below shows the fair values of derivative financial instruments, which are equivalent to the market values. 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Non-current Derivative financial assets Interest rate swaps used for hedging - 241 - 241 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Current Derivative financial assets Interest rate swaps used for hedging 600 1,363 Forward exchange contracts 5,735 - 6,335 1,363 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Current Derivative financial liabilities Forward exchange contracts - 1,539 - 1,539
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 25 21. Bank balances and cash 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Cash in hand 2,361 1,140 Cash at bank - in current accounts 129,236 179,874 - in call accounts 1,829 3,263 Bank deposits with an original maturity of less than three months 5,747 - Cash and cash equivalents 139,173 184,277 Less: Allowance for expected credit loss (183) (183) Cash and cash equivalents (A) 138,990 184,094 Bank deposits with an original maturity of more than three months (B) 855 1,086 Deposits under lien-restricted cash (C) 11,712 11,147 Bank balances and cash (A+B+C) 151,788 196,096 Cash in hand and cash at bank includes AED 0.6 million (31 December 2025 (audited): AED 0.3 million) and AED 88.7 million (31 December 2025 (audited): AED 91.9 million) respectively, held outside the UAE. Current accounts are non-interest bearing accounts. 22. Share capital 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Authorised, issued and paid up 170,000,000 shares of AED 1 each paid up in cash 170,000 170,000 823,703,958 shares of AED 1 each issued as bonus shares 823,703 823,703 993,703 993,703 (i) Dividend Below are the details of dividend distribution: - During the current period , the Company paid an annual dividend of 10 fils per share (AED 99,370.5 thousand) in respect of 2025 and an interim dividend of 10 fils per share (AED 99,370.5 thousand) for the first half of 2026, resulting in a total dividend distribution of 20 fils per share amounting to AED 198,741 thousand. - During year ended 2025, the Company paid an annual dividend of 10 fils per share (AED 99,370.5 thousand) in respect of the year ended 2024 and an interim dividend of 10 fils per share (AED 99,37 0.5 thousand) for the first half of 2025, resulting in a total dividend distribution of 20 fils per share amounting to AED 198,741 thousand .
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 26 22. Share capital (continued) (ii) Directors’ remuneration At the Annual General Meeting (AGM) held on 17 March 2026, the shareholders approved the Directors’ remuneration amounting to AED 3,700 thousand for the year ended 31 December 2025 , (for the year ended 31 December 2024: approved AED 3,700 thousand. (Refer note 7). 23. Bank financing arrangements (a) Islamic bank financing (i) Short-term 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Mudaraba facilities (refer A) 81,644 61,643 Commodity Murabaha facilities (refer B) 52,119 49,576 Current portion of long-term financing (refer note (ii) below) 106,301 125,625 240,064 236,844 (ii) Long-term – Islamic bank financing 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Mudaraba facilities (refer A) 292,394 288,333 Commodity Murabaha facilities (refer B) 160,729 84,804 Ijarah facilities (refer C) 20,327 51,806 Less : current portion of long-term financing (106,301) (125,625) 367,149 299,318 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Movement: Balance as at 1 January 424,943 364,781 Availed during the period/ year 150,000 179,062 Repaid during the period/ year (101,493) (118,900) Balance as at end of the period/ year 473,450 424,943 Less : current portion included in short-term (refer 23 (a)(i)) (106,301) (125,625) 367,149 299,318
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 27 23. Bank financing arrangements (continued) (a) Islamic bank financing (continued) (ii) Long-term – Islamic bank financing (continued) During the nine -month period ended 30 September 2025, the Group availed long term -Islamic bank financing AED 128.9 million and repaid AED 86.12 million. The securities provided against these facilities are the same as those mentioned in the consolidated financial statements of the Group for the year ended 31 December 2025. (A) Mudaraba is a mode of Islamic financing where a contract is entered into by two parties whereby one party (Bank) provides funds to the other party (the Group) who then invest in an activity deploying its experience and expertise for a specific pre-agreed share in the resultant profit. (B) In Murabaha Islamic financing, a contract is entered into between two parties whereby one party (Bank) purchases an asset and sells it to another party (the Group), on a deferred payment basis at a pre-agreed profit. (C) Ijarah is another mode of Islamic financing where a contract is entered into between two parties whereby one party (Bank) purchases/acquires an asset, either from a third party or from the Group, and leases it to the Group against certain rental payments and for a specific lease period. (b) Interest bearing bank financing (i) Short-term 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Bank overdrafts 66,654 56,896 Short-term loan 425,659 366,002 Non-convertible debentures (refer note (ii) below) 75,873 - Current portion of long-term financing (refer note (ii) below) 133,191 196,434 701,377 619,332 (ii) Long-term – interest bearing bank financing 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Balance as at 1 January 727,799 826,480 Availed during the period / year 53,735 98,572 Repaid during the period / year (143,435) (197,253) Balance as at end of the period / year 638,099 727,799 Less : current portion of long-term financing (refer 23 (b)(i)) (133,191) (196,434) Less : reclassification of non-convertible debentures to current (refer 23 (b)(i)) (75,873) - 429,035 531,365
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 28 23. Bank financing arrangements (continued) (b) Interest bearing bank financing (continued) (ii) Long-term – interest bearing bank financing (continued) During the nine month period ended 30 September 2025, the Group had availed long term - interest bearing bank financing amounting to AED 98.5 million and repaid AED 141.6 million. During the current period, the Group's subsidiary in India issued 3 -year 10.6% non -convertible debentures (NCD) amounting to AED 76.25 million. The NCDs are repayable in instalments from December 2027 to June 2029 and are listed at the Bombay Stock Exchang e (BSE) in India. The NCDs are subject to certain annual covenants, including minimum debt service coverage ratio of 1.2 times and the maintenance of a positive tangible net worth by the subsidiary. Transaction costs incurred in connection with the issuance have been capitalised and are being amortised over the term of the debentures using the effective interest method. Furthermore, a portion of the NCD proceeds, which were earmarked for capital expenditure, was utilised for purposes. This constituted a deviation from the terms of the NCD trust deed as at 30 September 2026, resulting into the outstanding NCD being classif ied as current liability in accordance with IFRS 18 Presentation and Disclosure of Financial Statements . Subsequent to the reporting date, the subsidiary has unded the shortfall and remediated the deviation. Except the above, the details of the b ank financing arrangements, including terms of repayment, interest rate and security provided are set out in the consolidated financial statements of the Group for the year ended 31 December 2025. 24. Trade and non-trade payables 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Trade payables* 328,713 352,821 Accrued expenses 333,871 308,745 Advance from customers 78,692 75,041 Commission payable 81,780 59,670 Non-trade payables 40,576 88,794 863,632 885,071 * Trade payables and accrued expenses principally comprise amounts outstanding for trade purchases and ongoing costs. No interest is charged on the trade payables. The Group has financial risk management policies in place to ensure that all payables are paid within the pre - agreed credit terms. The carrying amount of trade payables approximates their fair value. 25. Contingent liabilities and commitments 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Contingent liabilities Letters of guarantee 72,021 66,531 Letters of credit 97,873 27,465 Value added tax and other tax contingencies 46,625 56,370 Commitments Capital commitments 121,190 185,091 In some jurisdictions, the tax returns for certain years have not been reviewed by the tax authorities and there are unresolved disputed corporate tax assessments and VAT claims by the authorities. However, the Group’s management believes that adequate provisions have been made for potential tax contingencies.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 29 26. Hyperinflationary economy The Group has a subsidiary in the Islamic Republic of Iran, which did not have material operations during the year ended 31 December 2025 or during the nine months period ended 30 September 2026. The total assets of the Iranian subsidiary were 0.75 % of the Group’s consolidated total assets as at 30 September 2026 (31 December 2025 (audited): 0.56%). The hyperinflation impact has been calculated by means of conversion factors derived from the Consumer Price Index (CPI). The conversion factors used to restate the financial statements of the subsidiary are as follows: Index Conversion factor 30 September 2026 9,593.18 2.7924 31 December 2025 3,435.46 2.1600 31 December 2024 1,590.28 1.9326 31 December 2023 822.86 1.4616 31 December 2022 563.00 1.4847 31 December 2021 379.20 1.3514 31 December 2020 280.60 1.4479 The above-mentioned restatement is affected as follows: • Hyperinflation accounting was applied as of 1 January 2020; • The condensed consolidated statement of profit or loss is adjusted at the end of each reporting period using the change in the general price index and is converted at the closing exchange rate of each period, thereby restating the year to date condensed consolidated statement of profit or loss accounts both for inflation index and currency conversion; • Monetary assets and liabilities are not restated because they are already expressed in terms of the monetary unit current at the date of the condensed consolidated statement of financial position. Monetary items are money held and items to be recovered or paid in money; and • Non-monetary assets and liabilities are restated at hyper -inflation index applied to their historical cost (e.g. property plant and equipment, investment properties etc.) and equity of the subsidiary is restated using an inflation index. The hyperinflation impact resulting from changes in the general purchasing power until 31 December 2025 were reported in Hyperinflation reserve directly as a component of equity and the impacts of changes in the general purchasing power from 1 January 2026 are reported through the condensed consolidated statement of profit or loss in a separate line as a loss on net monetary position, besides having the impact on depreciation charge for the period.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 30 26. Hyperinflationary economy (continued) The impact of hyperinflationary accounting on the condensed consolidated interim financial information relating to the subsidiary in Iran is as follows: 1 January 2026 1 January 2025 AED’000 AED’000 (unaudited) (unaudited) Impact on condensed consolidated statement of financial position Increase in property, plant and equipment 18,386 5,169 Increase in investment properties- Net 17,485 5,175 Increase in other items of assets 11,484 4,579 Increase in equity 47,355 14,923 Allocated to: Increase in opening equity due to cumulative hyperinflation 47,355 14,923 Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Impact on condensed consolidated statement of profit or loss Increase in depreciation charge for the period 681 2,422 154 856 Loss on net monetary position 3,659 1,916 2,844 1,447 4,340 4,338 2,998 2,303
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 31 27. Acquisition of subsidiary During February 2026, the Group’s subsidiary in Kingdom of Saudi Arabia, has acquired 100% stake in Tebra AlArabia in the Yanbu industrial area for a purchase consideration of AED 16.6 million, with an intent to set up its manufacturing facility in KSA. The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are as set out in the table below: 30 September 2026 AED’000 (unaudited) Assets Property, plant and equipment 7,117 Right-of use assets 4,738 Trade and other receivables 1,919 Total assets acquired 13,774 Liabilities Lease Liabilities (5,134) Trade and other payables (6,644) Total liabilities assumed (11,778) Net assets acquired (A) 1,996 Net consideration paid (B) 16,667 Goodwill recognised (B-A) 14,671 Recognised goodwill represents the excess of the purchase consideration paid over the fair value of the net assets acquired. The accounting for the acquisition has been determined provisionally at the reporting date due to the ongoing assessment of the fair values of certain assets acquired and liabilities assumed. Accordingly, the goodwill recognised on acquisition is provisional and may be adjusted within the measurement period as permitted under IFRS 3. The Group continues to evaluate the fair values of identifiable assets and liabilities, including customer relationships / property, plant and equip ment / contingent liabilities / tax exposures, and any resulting adjustments will be recognised retrospectively as if the accounting had been completed at the acquisition date. During the period from the date of being accounted for as subsidiary to 30 September 2026, the acquired unit did not contribute to revenue or net profit or loss as it is yet to start its commercial operations since the civil construction and machinery erection is in progress. 28. Operating lease As Lessor: Certain Group entities lease out their investment properties under operating leases. The leases typically run for a period of one year to five years, with an option to renew the lease after that date. Lease rentals are usually reviewed periodically to reflect market rentals. Below are the lease rents receivable in future: 30 September 2026 31 December 2025 AED’000 AED’000 (unaudited) (audited) Less than one year 8,621 8,760 One to two years 7,956 7,773 Two to three years 7,500 7,500 Three to four years 2,500 7,500 Four to five years - 625 26,577 32,158
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 32 29. Segment reporting Basis for segmentation An operating segment is a component of the Group which engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transaction s with any of the Group’s remaining components. Segment results which are reported to the Company’s CEO (chief operating decision maker) include items directly attributable to a segment as well as those which can be allocated on a reasonable basis. Segment capital expenditure is the total cost incurred during the year to acquire property, plant and equipment, and intangible assets except goodwill. The Group has broadly four reportable segments as discussed below, which are the Group’s strategic business units. The strategic business units operate in different sectors and are managed separately because they require different strategies. The following summary describes the oper ation in each of the Group’s reportable segments: Ceramics products includes manufacture and sale of ceramic wall and floor tiles, gres porcellanato, bath-ware and table ware products. Faucets includes manufacture and sale of taps and faucets. Power, paints and includes manufacturing and distribution of power, paints, plastics, mines. Minerals (erstwhile called, ‘Other industrial’ segment) Real estate leasing includes material movement, real estate, construction projects and civil works. (erstwhile called, ‘Others’ segment) Information regarding the operations of each separate segment is included below. Performance is measured based on segment profit as management believes that profit is the most relevant factor in evaluating the results of certain segments relative to the entities that operate within these industries. There are regular transactions between the segments and any such transactions are at arm’s length price.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 33 29. Segment reporting (continued) Basis for segmentation (continued) Ceramic products Faucets Power, paints & minerals Real estate leasing Elimination Total AED’000 AED,000 AED’000 AED’000 AED’000 AED’000 Nine months period ended 30 September 2026 (unaudited) External revenue 2,005,471 363,120 69,502 5,295 1,664 2,445,052 Intersegment revenue 336,292 96,489 95,797 6,392 (534,970) - Segment revenue 2,341,763 459,609 165,299 11,687 (533,306) 2,445,052 Segment profit/(loss) 289,105 (27,433) 10,308 8,490 (95,983) 184,487 Segment operating profit/(loss) 391,638 (21,196) 10,979 8,020 (99,824) 289,617 Segment adjusted EBITDA 530,492 (5,932) 14,130 14,013 (92,152) 460,551 Segment assets 7,246,918 650,501 149,606 154,997 (2,893,914) 5,308,108 Segment liabilities 3,815,685 592,480 44,696 91,351 (1,557,928) 2,986,284 Nine months period ended 30 September 2025 (unaudited) External revenue 2,016,236 353,145 56,139 2,680 - 2,428,200 Intersegment revenue 359,546 87,908 99,709 1,644 (548,807) - Segment revenue 2,375,782 441,053 155,848 4,324 (548,807) 2,428,200 Segment profit/(loss) 286,311 (33,461) 8,352 11,352 (89,819) 182,735 Segment operating profit/(loss) 438,445 (20,193) 12,664 7,133 (150,337) 287,712 Segment adjusted EBITDA 536,977 (4,939) 15,069 13,322 (96,102) 464,327 As at 30 September 2025 (unaudited) Segment assets 7,067,222 631,928 148,137 153,030 (2,700,945) 5,299,372 Segment liabilities 3,772,126 546,187 47,202 103,881 (1,433,446) 3,035,950
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 34 30. Financial instruments Accounting classifications and fair values The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value. Fair value Hedging instruments Mandatory at FVTPL* Financial assets at amortised cost Financial liabilities at amortised cost Total Level 1 Level 2 Level 3 Total AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 30 September 2026 (unaudited) Financial assets measured at fair value Interest rate swaps used for hedging 600 - - - 600 - 600 - 600 Forward exchange contracts / Options 5,735 - - - 5,735 - 5,735 - 5,735 6,335 - - - 6,335 - 6,335 - 6,335 Financial assets measured at amortised cost Long-term receivables - - 40,014 - 40,014 - - - - Trade and non-trade receivables - - 886,180 - 886,180 - - - - Due from related parties - - 64,058 - 64,058 - - - - Bank balances and cash - - 151,788 - 151,788 - - - - - - 1,142,040 - 1,142,040 - - - - Financial liabilities measured at fair value Forward exchange contracts / Options - - - - - - - - - - - - - - - - - - Financial liabilities measured at amortised cost Islamic bank financing - - - 607,213 607,213 - - - - Interest bearing bank financing - - - 1,130,412 1,130,412 - - - - Due to related parties Long Term Loans - - - 1,408 1,408 - - - - Trade and non-trade payables - - - 863,632 863,632 - - - - Due to related parties - - - 56,807 56,807 - - - - Lease Liabilities - - - 116,095 116,095 - - - - - - - 2,775,567 2,775,567 - - - -
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 35 30. Financial instruments (continued) Fair value Hedging instruments Mandatory at FVTPL* Financial assets at amortised cost Financial liabilities at amortised cost Total Level 1 Level 2 Level 3 Total AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 31 December 2025 (audited) Financial assets measured at fair value Interest rate swaps used for hedging 1,604 - - - 1,604 - 1,604 - 1,604 Other currency and interest rate swaps - - - - - - - - - 1,604 - - - 1,604 - 1,604 - 1,604 Financial assets measured at amortised cost Long-term receivables - - 57,575 - 57,575 - - - - Trade and non-trade receivables - - 829,258 - 829,258 - - - - Due from related parties - - 63,364 - 63,364 - - - - Bank balances and cash - - 196,096 - 196,096 - - - - - - 1,146,293 - 1,146,293 - - - - Financial liabilities measured at fair value Forward exchange contracts / Options Other currency and interest rate swaps - 1,539 - - 1,539 - 1,539 - 1,539 - 1,539 - - 1,539 - 1,539 - 1,539 Financial liabilities measured at amortised cost Islamic bank financing - - - 536,162 536,162 - - - - Interest bearing bank financing - - - 1,150,697 1,150,697 - - - - Due to related parties Long Term Loans - - - 3,004 3,004 - - - - Trade and non-trade payables - - - 810,030 810,030 - - - - Due to related parties - - - 64,618 64,618 - - - - Lease Liabilities - - - 118,193 118,193 - - - - - - - 2,682,704 2,682,704 - - - - * Fair Value Through Profit & Loss
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 36 31. Management defined performance measures (MPMs) Management performance measures (MPMs) reflect management’s view of the Group’s financial performance and may not be directly comparable with similarly titled measures presented by other entities. The Group’s management measures the business performance using the following parameter. EBITDA adjusted for extra-ordinary gains or losses Nine months period ended Three months period ended 30 September 2026 30 September 2025 30 September 2026 30 September 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Profit for the period 184,487 182,735 77,959 67,500 Tax 52,502 55,097 20,308 19,119 Depreciation and amortisation 161,348 163,856 53,389 58,197 Interest 68,897 71,718 23,993 24,955 Gain on sale of property, plant, equipment and investment properties (6,683) (9,079) 98 (1,846) 460,551 464,327 175,747 167,925 Reconciliation of adjusted EBITDA to operating profit Nine months period ended Three months period ended 30 September 2026 30 September 2025 30 September 2026 30 September 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Adjusted EBITDA 460,551 464,327 175,747 167,925 Depreciation and amortisation (152,762) (154,126) (50,502) (54,854) Finance cost 4,361 3,262 1,161 897 Operating and maintenance expenses of investment properties 5,996 4,592 1,693 1,632 Income from investment properties (31,545) (33,556) (10,354) (10,593) Other income on investment properties (2,857) - (2,857) - Share of profit/(loss) in equity accounted investees 455 (408) 860 (260) Gain on sale of property, plant and equipment 5,418 3,621 (98) 889 Operating profit 289,617 287,712 115,650 105,636 Extra-ordinary gains or losses pertain to gain/loss on sale of property, plant, equipment and investment properties.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 37 32. Comparative information on IFRS 18 and IAS 1 for condensed consolidated interim statement of profit or loss IFRS 18, issued in April 2024, replaces IAS 1 Presentation of Financial Statements and will be effective for annual reporting periods beginning on or after 1 January 2027. Early adoption is permitted, and the Group has elected to a pply IFRS 18 from 1 January 2026 , with retrospective application in accordance with the standard’s requirements. The adoption of IFRS 18 introduces a revised presentation structure, whereby income and expenses are classified into operating, investing, financing, income tax and discontinued operations categories. Also, as permitted by the standard, the Group has incor porated subtotals in addition to Operating Profit and Profit or Loss before Financing and Income Taxes, to enhance financial statement transparency and provide a more structured summary. To ensure consistency with current period presentation, comparative figures for the previous period have been re -presented, where necessary. Such re-presented figures did not affect the previously reported comprehensive income, total equity, total assets, total liabilities and total cash flows . The comparative financial information has been re-presented to reflect the early adoption of IFRS 18.
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 38 32. Comparative information on IFRS 18 and IAS 1 for condensed consolidated interim statement of profit or loss (continued) IFRS 18 description and category Nine months ended 30 September 2025 Three months ended 30 September 2025 IAS 1 classification AED’000 AED’000 (unaudited) (unaudited) Revenue 2,428,200 824,917 Revenue Cost of sales (1,450,229) (490,924) Cost of sales Gross profit 977,971 333,993 Administrative and general expenses (174,445) (60,603) Administrative and general expenses Selling and distribution expenses (533,912) (176,896) Selling and distribution expenses Impairment loss on financial assets (19,729) (4,897) Impairment loss on trade and other receivables Loss on net monetary position (1,916) (1,447) Loss on net monetary position Net foreign exchange gain 3,360 (2,030) Finance income Net change in fair value of derivatives (831) 5,146 Finance cost Other operating income 37,214 12,370 Other income Operating profit 287,712 105,636 Share of profit/(loss) in equity accounted investees 408 260 Share of profit/(loss) in equity accounted investees Income from investment properties 33,556 10,593 Other operating income Finance income 3,296 630 Finance income Depreciation on investment properties (9,730) (3,343) Administrative and general expenses Operating and maintenance expenses of investment properties (4,592) (1,632) Administrative and general expenses Gain on sale of investment properties 5,458 957 Other income Profit / (loss) before financing and income tax 316,108 113,101 Finance costs (78,276) (26,482) Finance cost Profit before income tax 237,832 86,619 Tax expense (55,097) (19,119) Tax expense Net profit for the period 182,735 67,500
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 39 32. Comparative information on IFRS 18 and IAS 1 for condensed consolidated interim statement of profit or loss (continued) Other comprehensive income IFRS 18 description and category Nine months ended 30 September 2025 Three months ended 30 September 2025 IAS 1 classification (unaudited) (unaudited) Foreign exchange differences on translation of foreign operations (51,109) (3,264) Foreign exchange differences on translation of foreign operations Effects of application of hyperinflation accounting 14,923 7,079 Effects of application of hyperinflation accounting Cash flow hedges – effective portion of changes in fair value loss on hedging instruments (129) 70 Cash flow hedges – effective portion of changes in fair value loss on hedging instruments Cash flow hedges – effective portion of changes in fair value loss on hedging instruments - Reclassified to profit and loss (3,166) (930) Cash flow hedges – effective portion of changes in fair value loss on hedging instruments 33. Specified expenses by nature The Group discloses expenses by function in the condensed consolidated interim statement of profit or loss. Below are the details of specified expense by nature: Depreciation Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 Included in: (unaudited) (unaudited) (unaudited) (unaudited) Cost of sales 95,700 98,935 31,651 35,965 Administrative expenses 12,262 9,600 4,049 3,282 Selling expenses 41,932 41,783 13,949 14,310 Depreciation on investment property 8,586 9,730 2,887 3,343 158,480 160,048 52,536 56,900
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 40 33. Specified expenses by nature (continued) Amortisation Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 Included in: (unaudited) (unaudited) (unaudited) (unaudited) Cost of sales 606 673 214 212 Administrative expenses 2,262 3,135 639 1,085 2,868 3,808 853 1,297 Employee benefits Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 Included in: (unaudited) (unaudited) (unaudited) (unaudited) Cost of sales 188,309 209,183 63,053 71,423 Administrative expenses 97,747 92,228 30,722 33,452 Selling expenses 197,510 191,054 64,067 63,714 483,566 492,465 157,842 168,589 Impairment losses Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 (unaudited) (unaudited) (unaudited) (unaudited) Administrative expenses 10,997 19,729 312 4,897 Write down of inventories Nine months period ended 30 September Three months period ended 30 September 2026 2025 2026 2025 AED’000 AED’000 AED’000 AED’000 Included in: (unaudited) (unaudited) (unaudited) (unaudited) Cost of sales 28,042 32,911 8,263 12,267
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R.A.K Ceramics P.J.S.C. and its subsidiaries Notes to the condensed consolidated interim financial information (continued) for the nine months period ended 30 September 2026 41 34. Geopolitical Developments Ongoing regional geopolitical developments have increased uncertainty in the Group’s operating environment and contributed to disruptions in certain supply chains and shipping routes, as well as volatility in energy prices and logistics costs, which may adversely impact operating margins. The Group continues to closely monitor these developments and has implemented various mitigation measures, including production optimisation initiatives, inventory and working capital management, selective shipment re-routing through ports in the Kingdom of Saudi Arabia, and maintaining strategic inventory buffers to support continuity of supply. Management also notes potential market share opportunities within the UAE and GCC markets arising from disruption to certain impo rt flows; however, market conditions and pricing dynamics remain uncertain. Management also continues to assess the impact of these developments on the Group’s operations and on significant accounting estimates and judgements applied in the preparation of the condensed consolidated interim financial information. 35. Approval of the condensed consolidated interim financial information This condensed consolidated interim financial information was approved by the Board of Directors and authorised for issue on 5th November 2026.