UAE – Agthia Group PJSC, one of the leading food and beverages companies in the Middle East, has recorded a 61% jump in half-year net profits mainly driven by acquisition synergies and additional cost optimization.
According to a statement from the company, group net profits amounted to AED 67.9 million (US$18.49m) while total revenues appreciated 21% year-on-year to AED 1.32 billion (US$360m).
The Group’s consumer business division saw its share of net revenue contribution increase by 20% y-o-y to 65% with the agri-business division contributing the remaining 35% of the Group’s revenue.
Agthia noted that the rise was attributed to the addition of the 3 acquisitions it made during the first 6 months of 2021.
The Group’s bottled water portfolio – Al Ain Water, Al Bayan, Voss, and Alpin – sustained their market leadership in the UAE in both volume and value share at 27% and 25%, respectively.
The net revenue of the food segment, which includes tomato paste & frozen vegetables, bakery, dairy, and trading items, increased by 12% on the inclusion of Al Faysal Bakery & Sweets post-consolidation towards the end of January 2021.
Within Agthia’s agri-business, revenues reached AED 463.5 million (US$126.2m), lagging sales for the same period in 2020 which included a one-time World Food Program order.
“Agthia’s H1 performance has been driven by acquisition synergies, acceleration of transformation and additional cost optimization. We anticipate the momentum of this performance to continue over the coming months,” said Alan Smith, Chief Executive Officer of Agthia Group.
In the release, Agthia also revealed that was also included in the Morgan Stanley Capital International (MSCI) Emerging Markets Small Cap Index effective as of close of 27th May 2021, after fulfilling all the listing conditions.
Expansion in Egypt and Saudi Arabia
Meanwhile, Bloomberg has reported that the UAE based food processing company is eyeing food deals in Egypt and Saudi Arabia even as it seeks to consolidate its market position in the Middle East.
“We expect to see our growth coming from the consumer business,” Agthia chief executive officer Alan Smith said in an interview with Bloomberg Television.
“We’re going to continue to look for the right opportunities” for acquisitions with a focus on Saudi Arabia and Egypt, he said.
Earlier, Arab News had reported that the company was determined to expand further into Saudi Arabia as part of its wider five-year plan to seek out acquisitions and opportunities in the Middle East, North Africa and Pakistan (MENAP).
“Saudi Arabia is very much an aspirational target; we will continue to focus and look for opportunities,” Alan Smith, CEO revealed in an interview with Arab News.
“As an F&B (food and beverage) company, we look to expand in the market in the region and become a leader, and Saudi Arabia is a priority market,” he said.
Agthia Group is currently working in the water business in Jeddah, having acquired the Delta Bottled Water Co. in March 2017, and is aiming to expand its business in this sector.
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