RIYADH: Agthia Group PJSC, one of the region’s leading food and beverage companies, has booked a 58 percent increase in net revenues of over 1 billion dirhams ($272 million) in the first quarter of 2022, following the success of its strategy to enter new markets and acquire new food companies.
The company’s quarterly result reflects the change in its business stance last year when it acquired five companies, including Al Foah, Al Faysal Bakery & Sweets, Nabil Foods, Atyab and BMB Group.
“During 2021, we set out our strategy to diversify our business. We were keen to diversify our revenues by moving into higher-margin consumer goods categories and relying less on the commoditized portfolio. And to do that, we needed to grow,” the company’s CEO Alan Smith told Arab News.
We are keen to explore opportunities in the Saudi market.
Alan Smith, CEO
Not surprisingly, the company’s international business in the first quarter of 2022 amounts to 51 percent of its revenues. The revenue during the same period is up by 58 percent compared with the first quarter in 2021.
“This growth in revenue has been driven by the diversification of our revenues and the consolidation of newly acquired businesses, along with our industry-leading cost optimization initiatives and unmatched ability to enhance productivity.” Smith said.
“In the first quarter of 2022, our attention was focused primarily on the seamless integration of the entities acquired in 2021,” he added.
Group net profit attributable to shareholders registered at 82 million UAE dirhams for the quarter, a 64 percent increase relative to Q1 2021.
Setting eyes on new markets
After diversifying and acquiring major food and water companies, the company has now set its eyes on new markets in the Middle East.
“What we’re focused on now is to continue to look at the potential the Middle East, North Africa, Afghanistan and Pakistan market holds. We are looking for opportunities right for the business and fit in with our overall strategy,” said Smith.
The company has made significant investments in Egypt, Jordan and the UAE. In addition, it intends to increase its footprint in Ƶ.
“Ƶ is a big consumer market and increasing our footprint here is a part of our five-year strategy, and we are keen to explore opportunities in the Saudi market,” he remarked.
He further added: “The ambitious Vision 2030 is exciting for everyone. There was a big shift in the second half of last year, with people going out more. And I think that is a trend that will continue to grow.”
According to the group CEO, the company has done quite well in the Kingdom in terms of protein (Nabil) and snacking (BMB) and is still keen on doing more business. There’s room from improvement on the water category through restructuring to ensure better performance.
“We see significant headroom to grow further as Agthia continues to pursue full integration as a top priority in 2022,” said Smith.
What’s more? The company hasn’t stopped window shopping for new companies. His team is constantly looking for new opportunities that suit the group’s appetite.
“We spend a lot of time benchmarking those organizations, whether it’s the people or the capability. We also put a lot of time into identifying potential synergies,” Smith concluded.
