SMC Healthcare (4019) Wins SAR 3.8 Billion Ministry of Health Deal Worth 2.5 Times Its Annual Revenue

Specialized Medical Company (SMC Healthcare, 4019) has won a SAR 3.8 billion Ministry of Health contract to build and run the SABIC Behavioral Care Specialist Hospital, an award worth about two and a half times everything the company earned in revenue last year. The disclosure on June 18 is the largest contract in SMC's history, and it lands as a 15-year public-private partnership with a sovereign counterparty behind it.

The work sits inside Al-Mukhtas Al-Sehhi Medical Company, a subsidiary SMC owns 51 percent of. Under the partnership the Ministry of Health is the procurer and the asset owner, and the SMC subsidiary operates the facility: 150 inpatient beds, 19 outpatient clinics, and six day-care rooms, with services targeted to go live in January 2027.

Why the size matters

SMC booked SAR 1.54 billion of revenue in 2025 and SAR 266 million of net profit, on a market value of roughly SAR 4.35 billion. A single SAR 3.8 billion contract is close to 87 percent of the whole company's market capitalization and about 2.5 times last year's sales. Spread across the 15-year term and run at SMC's 2025 EBITDA margin of around 27 percent, the deal points to something on the order of SAR 70 million of annual operating profit once the hospital is fully running, which would lift group EBITDA by a mid-teens percentage. The 49 percent SMC does not own at the subsidiary takes its share of that, so the earnings uplift is real but proportionate. The larger prize is visibility. Fifteen years of contracted revenue from the Ministry of Health strips out a big piece of the execution risk the market had been pricing into the stock, which sat down 28 percent over the prior year.

The sector read

Saudi Arabia is pushing to place a large share of hospital management under private operators by 2030, and behavioral health is one of the most undersupplied corners of that plan. SMC now holds first-mover operating credentials in a dedicated behavioral facility in north Riyadh, which strengthens its hand in the next round of tenders. Sulaiman Al-Habib (4013), Fakeeh Care (4274), and Dallah Healthcare (4004) can be expected to compete harder for the pipeline that follows. The award also signals that Ministry of Health procurement is still moving at scale even with oil near $80 and the state budget under closer watch.

For investors, the number to track now is financial close and whether the January 2027 service date holds. The contract is signed. Delivery is the next test.