The net profits of the Saudi Almarai Dairy and Food Products Company increased during the third quarter of 2023 by about 5% on an annual basis, to record about 486.3 million riyals (about 129.7 million dollars), according to a disclosure from the company to the Saudi Stock Exchange on Sunday.
Almarai is one of the most prominent food and dairy products companies in Saudi Arabia. It produces 622 products through 7 brands, and owns 14 factories, including 8 factories in the Kingdom, while the rest of the factories are distributed in the Emirates, Egypt and Jordan, according to its website.
In its disclosure, the company attributed the increase in third-quarter profits to the growth in revenues (sales) by about 0.6% on an annual basis to approximately 4.8 billion riyals, with the company’s strong performance in its core markets in the Gulf countries, as a result of the increase in production capacity in the poultry sector, followed by the growth of the dairy and bakery sectors. As well as partial support thanks to the back-to-school season.
However, the company said that the devaluation of the Egyptian pound and the noticeable decline in demand for foreign alfalfa sales – mainly directed to the markets of East Asian countries – led to a decrease in its quarterly revenues by 3%, but the matter had no tangible impact on profitability.
The price of the Egyptian pound fell by about 50% after the government reduced the official exchange rate against the dollar three times – in light of an economic crisis following the war in Ukraine – to currently approach 31 pounds to the dollar. The dollar is traded in the parallel market for a price that has sometimes recently reached 42 pounds.
Compared to the second quarter of 2023, the company’s profits declined by 12.7% in the third quarter.
Nine-month results
Almarai’s net profits during the first nine months of 2023 increased by approximately 19.6% on an annual basis, recording approximately 1.7 billion riyals.
The company said that this increase in net profit is due to the growth of revenues during the same period by about 5.6%, to approximately 14.7 billion riyals, adding that increasing production capacity and expanding Almarai’s market share in several sectors also contributed to increasing profits.
(Prepared by: Maryam Abdel Ghani, contact: zawya.arabic@lseg.com)
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2023-10-08 09:00:00
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