In a move that reinforces its leading position in the logistics sector in Saudi Arabia, SAL Saudi Logistics announced the signing of a major construction contract worth a total of SAR 232.9 million. The agreement, signed last Thursday with the contracting and construction company, aims to execute the second phase of the development and expansion project for SAL's ground handling terminal at King Abdulaziz International Airport in Jeddah.
Contract details and schedule
In an official statement published on the Saudi Stock Exchange (Tadawul) website, the company explained that the scope of work includes a comprehensive package of new construction projects, in addition to the rehabilitation and improvement of existing facilities. The project also includes the development of support facilities and the modernization of the terminal's infrastructure to comply with the latest international standards and specifications adopted in the air cargo sector.
Regarding the project timeline, SAL indicated that construction work is scheduled to commence in the first quarter of 2026, with the project to be completed and fully delivered in the third quarter of 2028. This investment project will be financed through a combination of Sharia-compliant banking facilities, the company's available cash, and other available financing programs.
Strengthening the logistics infrastructure in Jeddah
This project holds particular strategic importance due to its location at King Abdulaziz International Airport in Jeddah, the Kingdom's main gateway to the Red Sea and a key logistics hub in the region. This development comes in response to the increasing volume of air cargo traffic, as the company seeks to expand the terminal's capacity to meet current and future operational demands, ensuring the smooth flow of goods and rapid handling.
Alignment with the Kingdom's Vision 2030
This contract cannot be viewed in isolation from the general economic context of the Kingdom, as this project directly contributes to the objectives of the National Transport and Logistics Strategy stemming from Saudi Vision 2030. This vision aims to transform the Kingdom into a global logistics platform linking the three continents, through the development of airport and port infrastructure and the improvement of supply chain efficiency.
Investing in ground handling terminals is a key pillar for supporting other vital sectors such as e-commerce, industry, and national exports, as improving shipping efficiency contributes to reducing operating costs and attracting more global airlines and major shipping companies to make Jeddah a hub for their operations.
Expected financial impact
The company concluded its statement by emphasizing the anticipated positive impact of this project on its financial statements. This impact is expected to begin gradually appearing upon completion of the works and commencement of actual operations at the upgraded plant in the third quarter of 2028, following the receipt of all necessary regulatory approvals from the relevant authorities.
