Riyadh / SA. (ac) In October 2023 Almarai Company announced its condensed consolidated interim financial results for the period ended on 30th September 2023 (nine months). The increase of 5 percent in the Consolidated Profit Attributable to the Company’s Shareholders for Q3-2023, as compared to the corresponding quarter of 2022, is due to – among others:
- Revenue (+1 percent): A strong performance in core GCC markets resulted in year-on-year growth of 4 percent. This was led primarily by an expansion in the capacity of the Poultry category, followed by growth of the Dairy and Bakery category, thanks in part to another successful ‘back to school’ season.
- Operating Profit (+11 percent): Disciplined cost controls across the board, including General and Administration expenses, supported double-digit growth of 11 percent in operating profits. Stringent cost controls were applied across all areas of the business; however, the Group increased its investments in trade support and marketing activities to further engage with its end consumers.
- Net Profit Attributable to Shareholders (+5 percent): Net profit for Q3-2023 grew at 5 percent compared to the same quarter in 2022. This was driven by positive revenue growth in core markets, strong cost controls in operations and stable commodity costs. This robust operational performance allowed the Group to offset higher funding costs caused by the increase in the SAIBOR interest rate and a one-off benefit for zakat provision in 2022.
Overview for the nine months ending Q3-2023
The 20 percent increase in Consolidated Profits Attributable to the Company’s Shareholders for nine months ending Q3 2023 – as compared to nine months ending Q3-2022 – is, among others, due to:
- Revenue (+6 percent): Revenues have consistently grown in Almarai’s core GCC markets for each of the past three quarters in 2023. This consistent growth has been driven mainly by the Group’s Poultry, Dairy and Bakery categories. However, the growth has been partly offset by the significant devaluation of the Egyptian pound and lower external sales of alfalfa due to weaker global demand, resulting in overall group revenue growth of 6 percent.
- Operating Profit (+22 percent): Disciplined cost controls, the stabilization of commodity costs and a sharp focus on operational excellence resulted in operating profit growth of 22 percent for the first three quarters of the year.
- Net Profit Attributable to Shareholders (+20 percent): On a year-to-date basis, top line growth has been driven by capacity expansion and market share gains across multiple categories. In addition to revenue growth, tight controls on overheads were applied, despite having higher funding costs due to the higher SAIBOR rate. This resulted in net profit growth of 20 percent for the first 9M-2023.