14 October 2024
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Global Industry

Almarai: Announces 2023 Consolidated Financial Results

Riyadh / SA. (ac) In January Almarai Company announced its consolidated financial results for the financial year ended on 31st December (12M-2023). The increase of two percent in revenue as compared to the corresponding quarter of last year is due to a positive performance in core GCC markets, led by Saudi Arabia, resulted in quarterly growth of five percent. The Consolidated Profit increased to four percent.

Element List Current Quarter Similar Quarter For Previous Year Percent Change Previous Quarter Percent Change
Sales/Revenue 4,919,738 4,839,233 1.663 4,796,934 2.56
Gross Profit (Loss) 1,396,908 1,333,986 4.716 1,469,452 -4.936
Operational Profit (Loss) 528,895 504,023 4.934 643,935 -17.865
Net profit (Loss) 370,719 355,823 4.186 486,263 -23.761
Total Comprehensive Income 294,516 403,052 -26.928 468,750 -37.169
All figures are in (Thousands) Saudi Arabia, Riyals

 

Element List Current Period Similar Period For Previous Year Percent Change
Sales/Revenue 19,575,585 18,722,258 4.557
Gross Profit (Loss) 6,051,290 5,624,223 7.593
Operational Profit (Loss) 2,693,888 2,276,332 18.343
Net profit (Loss) 2,049,123 1,759,812 16.439
Total Comprehensive Income 1,799,986 1,685,361 6.801
Total Share Holders Equity (After Deducting the Minority Equity) 17,797,719 16,671,360 6.756
Profit (Loss) per Share 2.08 1.79
All figures are in (Thousands) Saudi Arabia, Riyals

 

Element List Percentage of Capital (%) Amount
Profit (Losses) Resulting From The Change In Investment Propertie’s Fair Value – –
All figures are in (Thousands) Saudi Arabia, Riyals

 

Element List

Explanation
The reason of the increase (decrease) in the sales/ revenues during the current quarter compared to the same quarter of the last year is The increase of 2 percent in revenue as compared to the corresponding quarter of last year is due to: Positive performance in core GCC markets, led by Saudi Arabia, resulted in quarterly growth of 5 percent. The growth was driven mainly by positive contribution from the poultry and dairy categories. However, Almarai group revenue growth was reduced to 2 percent due to lower sales of commodities in North America and lower contribution from Egypt due to Egyptian Pound devaluation.
The reason of the increase (decrease) in the net profit during the current quarter compared to the same quarter of the last year is The increase of 4 percent in the Consolidated Profit Attributable to Shareholders of the Company as compared to the corresponding quarter of last year is due to:

  • Operating Profit (+5 percent): Operating profit increased by 5 percent due to revenue growth, accompanied by stabilized commodity costs and well managed operating costs.
  • Net Profit (+4 percent): Despite higher funding costs, net profit for the fourth quarter of 2023 increased by 4 percent mainly due to the higher operating profit and partly due to the synergies driven by 100 percent acquisition of the Egypt and Jordan business earlier in the year.
  • Contribution of various Business Categories towards the increase in the Consolidated Profit Attributable to Shareholders of 4 percent is as follows:
    • Dairy + Juice Category: Net profit increased compared to last year due to improved sales in key markets in the Gulf countries and strict controls over costs.
    • Bakery Category: Higher net profit versus last year driven by revenue growth led by bread and by single serve products.
    • Poultry Category: Higher net profit versus last year due to positive volume growth supported from increased production capacity availability early in the year.
The reason of the increase (decrease) in the sales/ revenues during the current quarter compared to the previous one is The increase of 3 percent in Revenue for the fourth quarter 2023 (SAR 4,920 million), as compared to the third quarter of 2023 (4,797 SAR million) is due to higher sales of dairy food products driven by seasonal demand and higher poultry products driven by supply increases.
The reason of the increase (decrease) in the net profit (loss) during the current quarter compared to the previous one is The decrease of 24 percent in the Consolidated Profit Attributable to the Company’s Shareholders for the fourth quarter 2023 (SAR 371 million), as compared to the third quarter of 2023 (486 SAR million) is due to seasonal adjustments in consumption patterns.
The reason of the increase (decrease) in the sales/ revenues during the current period compared to the same period of the last year is The 5 percent increase in Revenue in the current year 2023 as compared to last year 2022 is due to: The strong performance in core GCC markets resulting in a growth of 8 percent for the group, led by the poultry and dairy categories. However, the net revenue growth at group level was reduced to 5 percent due to the devaluation of the Egyptian Pound and lower sales of alfalfa from the USA operations.
The reason of the increase (decrease) in the net profit during the current period compared to the same period of the last year is The 16 percent increase in Consolidated Profits Attributable to the Company’s Shareholders in the current year 2023 as compared to last year 2022 is due to:

  • Operating Profit (+18 percent): Revenue growth supported by cost control and stable commodity costs contributed to operating profit growth of 18 percent during the current year. The results improved due to the expansion of the poultry category, the launch of several new products and the effect of the increased direct marketing communication with consumers.
  • Net Profit Attributable to Shareholders (+16 percent): Shareholder net profit for the current year was higher than last year due to positive operating profit growth and the acquisition of the 100 percent share of Group’s operations in Egypt and Jordan, despite higher funding costs due to higher interest rates.
  • Contribution of individual Business Categories towards the 16 percent increase in the Consolidated Profit Attributable to Shareholders is as follows:
    • Dairy + Juice Category: Net profit increased compared to the previous year due to improved sales in the Gulf countries, and strict cost controls contributing to the category net profit growth. The strong results were achieved whilst managing the impact of the Egyptian pound devaluation in this business category.
    • Bakery Category: Higher net profit is driven by both volume and sales growth. The top line growth was driven by multiple factors including improved sales in Bread along with growth in single serve products, product innovation, and economies of scale.
    • Poultry Category: The increase in net profit was driven by sales growth aided by additional production capacity and improved operational efficiency.
Statement of the type of external auditor’s report Unmodified conclusion
Comment mentioned in the external auditor’s report, mentioned in any of the following paragraphs (other matter, conservation, notice, disclaimer of opinion, or adverse opinion) The consolidated financial statements of the Group for the year ended 31 December 2022, were audited by another auditor who expressed an unmodified opinion on those consolidated financial statements on 29 Jumadal-Akhirah 1444H corresponding to 22 January 2023.
Reclassification of Comparison Items For more information, please see note 2.1 in the consolidated financial statements for the Year ended 31st December 2023.
Additional Information General Comments: Stable market environment and strong trading performance have enabled Almarai to post solid growth in profits exceeding SAR 2B. Almarai rolled out multiple new products during the year and has provided earlier guidance for its plan to enter Seafood and Frozen Bakery business. The expansion of its product portfolio, sustained investment in consumer communication and continual focus on operational efficiency have assisted Almarai to achieve this progressive growth in net profit. Going forward, Almarai expects its core business to continue to gain market share in selected product categories and geographies, explore additional opportunities to grow inorganically and deploy capital in line with its 5 years investment strategy.

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