Agthia Group net revenue rises 12.1 % YoY to Dh4.6 billion

Underlying group net profit grows 25.5% YoY


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Agthia's flagship water brand, Al Ain Water, retained its market leading position in the UAE on account of strong volume sales.
Agthia's flagship water brand, Al Ain Water, retained its market leading position in the UAE on account of strong volume sales.

Published: Thu 15 Feb 2024, 12:29 AM

Agthia Group PJSC, one of the region’s leading regional food and beverage companies, on Wednesday announced its preliminary and unaudited results for the fiscal year ending 31 December 2023.

Group net revenue increased 12.1 per cent year-on-year to Dh4.6 billion during FY’23, supported by a continued shift in the Group’s product portfolio towards higher growth segments in key target markets. Snacking was the top-performing vertical, with 38.0 per cent year-on-year growth. Group like-for-like (LFL) revenue growth was 5.7 per cent year-on-year, with Agri (+19.9 per cent YoY) and Water & Food (+6.0 per cent YoY) being major contributors of growth during the period.

EBITDA rose 21.1 per cent year-on-year to Dh689 million during the reporting period, with the EBITDA margin expanding +113bps (exceeding the guidance range of 40-60bps) to 15.1 per cent. EBITDA outpaced revenue growth, with greater scale and diversification increasing the Group’s ability to deliver consumer-relevant product innovations, optimize product and channel mix, procure favorably, and preimmunize its product offerings.

Underlying group net profit1 grew 25.5 per cent year-on-year to Dh342.2 million, expanding net profit margin by +80bps (exceeding the guidance range of 30-50bps) to stand at 7.5 per cent, notwithstanding further FX and interest rate headwinds throughout 2023. Reported group net profit1 increased 9.9 per cent year-on-year at Dh299.6 million (one-off1).

Underlying earnings per share1 (EPS) rose 23.0 per cent year-on-year to Dh0.384, while reported EPS1 grew 5.8 per cent year-on-year to Dh0.330.

Snacking revenue grew 38.0 per cent year-on-year (+9.3 per cent on a like-for-like basis) on strong revenue growth across the Group’s snacking portfolio, led by dates products and packaging innovations across mid and high-value ranges, growth in date varieties, combined with a premiumization shift in portfolio, as well as value growth across retail channels in the UAE and internationally (e.g. India, Indonesia, Malaysia, and Brazil).

Outside of dates, revenue contribution for FY’23 from BMB and Abu Auf collectively was Dh546 million, with the former seeing stronger growth in core markets, and continued volume and value gain in premium-branded coffee at Abu Auf in Egypt resulting in a 72 per cent increase in FY’23 local currency revenue.

Water & Food revenue grew 6.0 per cent year-on-year, reflecting significant growth in the UAE, driven by premiumization and innovation, with margins expanding on improved mix and productivity. The Group continued to retain its market leading position in the UAE bottled water segment, successfully launching value-added innovations such as Al Ain Plus (zinc fortified water), premium glass bottles, and a 100 per cent rPET bottle (made of post-consumer recycled plastic which is infinitely recyclable). International business revenue also increased, with notable performances from Saudi Arabia, Kuwait, and Turkey.

Protein & Frozen showcased resilience despite a reported decline in dirham terms, amid the challenging macro and consumer environment of 2023, which included the significant devaluation of the Egyptian pound. The segment proactively safeguarded and prioritized its profitability and market leadership by adeptly implementing pricing strategies and optimizing costs.

Agri-business revenue grew 19.9 per cent year-on-year, with strong volume growth across Flour and Feed, enabled by Feed sales through the Agrivita mobile app, offering end users added convenience and increasing its competitive edge. Segment performance was up significantly year-on-year, reflecting strong in-market execution and cost discipline.

Agthia Group’s total assets stood at Dh6.6 billion as at 31 December 2023, with total shareholders’ equity2 of Dh2.9 billion.

Khalifa Sultan Al Suwaidi, Chairman of Agthia Group
Khalifa Sultan Al Suwaidi, Chairman of Agthia Group

Khalifa Sultan Al Suwaidi, Chairman of Agthia Group, said: “Agthia’s continued strong performance, despite a challenging economic environment, demonstrates the company’s ability to reap the rewards from its value-accretive M&A activities, leverage synergies across the Group, prioritize innovation across its product portfolio, and optimize its operations to maintain profitability. I am confident that Agthia will further solidify its position in key market segments, aiming to provide high-quality and trusted food and beverage products to an increasing number of consumers.”

Alan Smith, Chief Executive Officer of Agthia Group, said: “Strong revenue and profit growth over the past year is testament to the tireless efforts and agility of all our colleagues across the Group, despite significant macroeconomic challenges and the high interest rate environment. I am positive that Agthia can consistently deliver on its strategy of acquiring, integrating, and growing attractive businesses in value-add categories, as we continue to pursue our ambition to become a leading food and beverage company in the MENAP region and beyond.”

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