Miahona is a leading player in the water and wastewater sector in the Kingdom, with a proven track record of performance and commitment to innovation.
The first wastewater infrastructure project under the PPP model in Jeddah Industrial City is managed by Miahona.
With the first-mover advantage in the PPP sector, Miahona has six projects under long-term concessions with government and government-related entities and a further six projects on the Operation & Maintenance contract structure.
The total capacity of wastewater infrastructure projects portfolio is 1,026,500 m3/day and a network of 221 km (incl. Spark project: 326 km) and potable water infrastructure of 102,800 m3/day with a total network of 248 km (incl. Spark project: 342 km).
Miahona operates in a well-regulated industry, following the introduction of the National Water Strategy by the Ministry of Environment, Water and Agriculture in 2017.
The National Water Strategy aims to improve water and sanitation management and increase private sector participation, reducing non-revenue water to 25% (current average: 40%), increasing the percentage of water reuse from 17% in 2017 to 70% in 2030, increasing the coverage of water services from 87% to 95%.
Miahona is well positioned to benefit from the growing demand for water and wastewater services in the Kingdom, driven by specific factors such as population growth, urbanization, and the Kingdom’s water sector strategies within the framework of Vision 2030, including privatization projects, PPP, and regulatory changes.
The government has announced a solid pipeline of new water/wastewater projects to be tendered to the private sector and management believes Miahona is well placed to benefit, having been awarded or selected as the preferred bidder at a win rate of 80% in the last three years.
The Company's competitive strengths lie in its ability to develop projects, and in its ability to manage operations and maintenance of a broad base of assets and contracts with diversified cash flows across the project life cycle.
The overall impact of privatization, government initiatives regarding PPP, and macroeconomic factors create a large market opportunity for the Company to leverage its leading position and deep sector experience.
The Kingdom’s population is expected to grow at a rate of 3.6% to 38.4 million people in 2027, with water demand expected to increase from 5.2 billion cubic meters annually in 2022 to 5.9 billion cubic meters annually in 2027.
The company's major customer SWPC has announced a seven-year plan to increase sewage treatment capacity by ~2.3 million m³ by 2027. Despite this planned expansion, there remains a capacity gap of ~2 million m³ as identified in Vision 2030, which necessitates further investment. Consequently, there is a substantial market opportunity available for the company. The company intends to enhance its market share by leveraging this potential growth.
NWC, at the recent GWI conference, indicated a large pipeline of projects, which will demand substantial investment. The company aims to capture increased market share within this pipeline of projects.
NWC's six regional clusters are in phase 1 under Manage-Operate-Maintain (MOM) contracts with a 7-year tenure. These will transition to long-term concession arrangements in phase 2. The company has been awarded 2 MOM contracts in phase 1, enhancing its chances of success in the phase 2 tendering process. Phase 2 will encompass the entire water value chain and may have an expected term of over 30 years. Transitioning the six clusters will require an estimated additional investment of more than ~SAR 25 billion, offering substantial growth opportunities for the company.
Furthermore, the government’s target to increase water reuse to 70% (current level: 22%) will bring significant business opportunities. The Company is well positioned to capture market share of reuse.
Miahona is considered one of the leading private sector companies and was the first company in the Kingdom working to develop water and wastewater infrastructure according to the public-private partnership model, providing sustainable solutions for industrial and municipal facilities.
The Company is present across Saudi Arabia’s eight major cities and has operations that cover the entire water sector cycle from extraction and supply to collection and recycling.
With a commitment to operational excellence, the Company’s integrated model allows it to optimize its operations, reduce waste, and ensure consistent supply. For example, Miahona implemented a number of efficiency and productivity measures, with the percentage of water loss (leakage) reaching less than 10%, compared with the Kingdom’s Vision 2030 target of less than 25% and the current average in the Kingdom of 40%.
Miahona remains at the forefront of adopting new technologies and innovative solutions, partnering with internal expert teams such as development, technical, financial, legal, and project management.
Its proven track record and strong technical and operational know-how uniquely position Miahona to re-tender for its existing contracts at the time of renewal.
Miahona has well-established capabilities in construction, ownership, operation and transfer agreements, or rehabilitation, operation and maintenance agreements in the municipal and industrial sectors, whether independently or with partners.
The Company has a strong client base, including the Saudi Water Partnership Company (“SWPC”), the National Water Company(“NWC”), the Saudi Authority for Industrial Cities and Technology Zones (“MODON”), the General Authority of Civil Aviation (“GACA”), and industrial companies such as Saudi Aramco.
Miahona has high visibility over its future cash flow, with the Company’s six concession contracts having a typical length of between 20 and 30 years, accounting for over 92% of revenue as of FY 2023.
Management believes that the Company's business model is low risk and provides it with a solid foundation for further growth, with long-term and predictable cash flows. When the Company invests its own capital, it manages risks through:
focusing on fully contracted long-term opportunities.
most contracts including risk mitigation provisions such as for inflation, protection due to changes in laws, and operating costs charged to the client; and
low credit risk due to the contractors being either government or government-backed entities.
Miahona believes that it develops, invests and operates a business model that allows it to achieve total returns significantly above its cost of capital or hurdle rate (minimum acceptable rate of return) across its services and portfolio.
This business model supports the Company's ability to maximize price competitiveness by allocating the required total return across different value streams of development, investment, and operation.
Miahona also aims to adopt an optimal financing model for each project, using non-recourse project financing loans, with the aim of reducing the cost of financing each project and improving the risk/return profile for its shareholders.
The Company has a healthy backlog, which has grown steadily in recent years. The current total project backlog is SAR 11.3 billion, which includes an existing backlog of SAR 5.9 billion and a secured project backlog of SAR 5.4 billion.
Miahona has delivered strong financial results over the last three years, achieving revenue CAGR of 12.3% between 2021 and 2023, and EBITDA margin has grown from 36.9% to 43.8% during this time period.
Management believes that the Company’s streamlined operations allow for sustainable profit generation, with a strong and improving EBITDA signaling increased operational efficiency through economies of scale.
Miahona has a proven ability to sustainably fund operations and capitalize on growth opportunities.
Miahona’s management team comprises individuals with deep operational experience and executive capabilities gained through their work with the Company, and within the professional services and sector-related entities.
The Company has invested effectively in its internal capabilities and its team includes multidisciplinary and multicultural professionals with technical expertise in project financing, construction supervision, legal, procurement, and other services.
Miahona has a robust corporate governance framework in place with a well-structured Board of Directors, Audit committee, Executive committee, and Nominations & Remunerations committee.
