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ADX-listed Agthia Group, one of the region’s leading food and beverage companies, announced on Thursday that it achieved a 10.6 percent year-on-year revenue increase in UAE dirhams terms from its Egyptian businesses for the first nine months of 2024, despite a significant AED264.5 million impact from EGP devaluation.
The Group CFO Sherif Elfaham said Egypt remains a priority market for the Abu Dhabi-headquartered company due to its favorable demographic trends and strong demand for protein, coffee, and snack products.
He said in AED terms, the company’s Egyptian EBITDA rose 43.9 percent, with over a 450 basis point increase in margin. Export revenue also grew by 31.5 percent to AED 73.2 million, supporting Agthia’s plans to expand its reach in the Middle East and North Africa region.
Elfaham stated that Egypt’s competitive manufacturing environment and position within the region provide a hedge against currency volatility.
“In addition to supporting exports, Egypt offers a strong foundation to expand into new markets, particularly across the GCC and North Africa, where several countries benefit from favorable trade agreements,” he said.
Amid geopolitical tensions, Elfaham emphasised Agthia’s resilience and adaptability across its diverse markets.
“Our diversified portfolio equips us to manage volatility effectively, and we remain vigilant in monitoring the situation to mitigate potential impacts.”
Despite challenges, Elfaham said the company is confident in meeting full-year guidance for 2024, based on stable assumptions about the USD/EGP rate of 40, 3-month SOFR interest rates of around 5.5 percent, and stable geopolitical conditions in key markets.
He noted Agthia’s strong cash position and low leverage ratio of 1.4x Net Debt/EBITDA, which allows for future acquisitions and expansions.
Overall, the company announced strong performance across its four business segments for the first nine months of 2024.
Elfaham said Agthia’s Agri-Business segment led the revenue increase with an 18.3 percent year-over-year gain, while the Snacking segment saw a 14.2 percent rise, and Water & Food grew by 5.8 percent, contributing to a 68 basis point expansion in EBITDA margin, reaching 14.9 percent for the period.
Revenues for the nine-month period grew 11.5 percent year-on-year to reach 3.6 billion UAE dirhams. Net profit grew 24 percent year on year to reach AED 255 million.
On the profitability front, the Agthia CFO noted that the Agri-business registered a margin increase of 255 basis points; the Protein and Frozen segment reported a 137 basis point increase, Snacking saw a 163 basis point rise while the Water segment’s margin grew by 114 basis points.
“Notably, innovation alone accounted for 57 percent of Agthia’s growth in the first nine months, excluding one-off contributions recorded in the first quarter of 2024. This emphasis on innovation aligns with the group’s commitment to reshaping its portfolio towards premium categories that cater to evolving consumer demands,” he said. The company attributed AED 123 million in revenue generated to strategic product innovation.
(Reporting by Marwa Abo Almajd; Editing by Anoop Menon)
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