SAUDI ARABIA – Almarai, a Saudi multinational dairy company specializing in food and beverage manufacturing and distribution, headquartered in Riyadh, Saudi Arabia, has reported a 24% rise in the final quarter of 2022 (Q4-22) net profit.
The Q4-2022 net profit was recorded to be SAR355.8 million (US$95 million) and was attributed to higher sales in the company’s poultry and bakery segments.
The company’s poultry volume growth maintained growth due to additional capacity available in the year’s second half, which resulted in 10% additional bird capacity.
The increase in capacity led to the reported net income profitability.
According to a statement released by the company to the Saudi stock exchange Tadawul, where its shares are traded, the revenue generated in the entire quarter increased by 14% to SAR4.8 billion (US$1.3B).
All categories dairy and juice, bakery and poultry, reported an increase in sales. From the bakery section, revenues rose by 29% while poultry reported an increase of more than 31%, according to the company.
This growth was driven by robust farming performance.
Although dairy and juice sales increased by 5.8%, their income was offset by inflation in dairy and feed commodities prices and the seasonality effect.
However, the profits recorded in Q4-2022, despite being an increase from the previous quarter, missed the estimated SAR512 million (US$136.4M) on lower margins.
For the entire financial year of 2022, the company made a net profit of SAR1.76 billion (US$476.8M), a 12% increase compared to 2021, while revenue increased by about 18% to SAR18.7 billion (US$4.98B)
The company expects the momentum to persist even at a lower rate as they get accustomed to the consumption patterns after the full opening of education institutions and the resumption of tourism activities.
“The key risk remains surging cost inflation for dairy and feed commodities. We continue to see parts of the global supply chain remaining under stress although some areas are now showing signs of stability,” they said in the statement.
Consumer prices in Saudi Arabia increased to 3.3% year-on-year in December, together with higher housing costs driving up inflation, according to the latest government data. The company said that its net profit growth is in line with inflation.
Alamari also reported a 3.4% total stakeholder equity increase in 2022 to SAR16.6 billion (US$4.4B) with a profit per share at SAR1.79 (US$0.48), compared to the year before.
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