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1830

Governance: A

LEEJAM SPORTS

Leejam Sports Co.

81.05 SAR / Share

As of: May 28, 2026

14.7x P/E Ratio Trailing 12 Months

3.6x P/B Ratio Price to Book Value

4.4% Dividend Yield Annual Dividend / Share

4.13B SAR Market Cap Total Valuation

1.34 Beta Systematic Risk Index

17.4% Net Margin Net Profit / Revenue

The Story

Leejam Sports leverages its dominant Fitness Time brand to convert Saudi Arabia's growing health consciousness into highly profitable, cash-generative sports centers.

Source: Q1 2026 (2026-05-06)

Value Creation +8.6% Excess Return on Capital (Spread between ROIC/ROE and Cost of Capital)

Cash Flow Payback — Estimated years of operating cash flows required to cover Enterprise Value

Performance & Distributions

Dividend Yield Trailing annual dividends paid relative to share price

4.4%

Sustainable Growth Rate Rate at which company can grow internally using reinvested profits

+3.6%

Payout Ratio Percent of net profits distributed as dividends

64.2%

Net Margin Net profit margin generated from total operational revenue

17.4%

ROIC Return on Invested Capital

15.7%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

14.7x

P/B Ratio Market capitalization compared to corporate book value

3.6x

EV / EBITDA Operating multiple reflecting core operational leverage

9.9x

EV / SALES Asset pricing multiple relative to total topline revenue

4.6x

Growth Story

Revenue has grown steadily from SAR 1.33 billion in FY 2023 to SAR 1.50 billion in FY 2024, reaching SAR 1.61 billion in FY 2025 and maintaining a TTM level of SAR 1.61 billion. This growth is supported by a 5-year average reinvestment rate of 22.95%. Combined with a strong 5-year average ROIC of 15.67%, the company possesses a sustainable growth rate of 3.60%. This indicates a solid capacity to self-fund its long-term expansion, primarily driven by its core Saudi Arabian operations which brought in SAR 358.40 million of the SAR 369.36 million total revenue in Q1 2026, while female centers continue to emerge as a key growth vector.

Profitability Dynamics

Leejam demonstrates exceptional value creation, boasting a 5-year average ROIC of 15.67% that comfortably outpaces its WACC of 7.05%, resulting in a positive value-creation gap of 8.62%. This profitability is underpinned by robust operating efficiency, with a TTM operating margin of 25.46% and a net profit margin of 17.35%, translating to TTM EBIT of SAR 411.18 million and NOPAT of SAR 405.14 million. Although capital expenditures remain significant at SAR 371.43 million TTM to support new center rollouts, the company's high-margin subscription model ensures consistent cash generation, enabling regular quarterly dividend distributions and strategic share buybacks.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

1.34

Cost of Equity Minimum required rate of return demanded by shareholders

10.2%

WACC Weighted average cost of total debt and equity funding

7.0%

Debt-to-Equity Ratio Proportion of corporate funding financed by debt creditors

84.6%

Risk Factors

While Leejam's business model is highly profitable, it carries structural leverage with a latest total debt of SAR 3.50 billion (including substantial lease liabilities associated with its fitness center network) and a gearing ratio of 1.8 as of March 31, 2026. The company's current ratio stands at 0.8, reflecting a net current financial liability position of SAR 127.04 million, though this is mitigated by SAR 912 million in unutilized bank financing facilities. Additionally, the company faces a beta of 1.34, reflecting higher market sensitivity, and has recently resolved a historical ZATCA zakat dispute regarding former shareholder tax exposures by recording a SAR 32.7 million liability, which is being managed via an installment plan and a reimbursement agreement.

Governance Disclosures

Rating: A

We track 10 key governance and oversight matters for this company in our database.

Significance: 2/10 Tunneling

Purchases of assets and supplies from shareholder affiliates

The Group purchased furniture from Dhaoq Almanzel Trading Est amounting to SAR 124,090 and supplies from Afaq Al-Anaqah Trading amounting to SAR 393,469 during the three-month period ended 31 March 2026. Both entities are classified as shareholder affiliates.

Significance: 4/10 Tunneling

Lease rentals paid to shareholder

The Group paid lease rentals of SAR 3,400,000 during the three-month period ended 31 March 2026 to Hamad Ali AlSagri, who is a major shareholder of the company.

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In-Depth Analysis