Agthia profit drops 25% to Dh86m

Agthia Group, one of the UAE’s leading food and beverage companies, said on Thursday its net profit dropped 25 per cent to Dh86 million in 2011 caused by the higher soft commodity and PET prices.

The board of directors also proposed five per cent cash dividend.

The company posted net sales of Dh1.14 billion, a strong 14 per cent year-on-year growth.

The Consumer Business Division (CBD) recorded a 18% net sales growth year on year at Dh376.9 million and Agri Business Division (ABD), which manages the flour & animal feed business, delivered a 12% net sales growth reaching  Dh767.4 million.

In December 2011, the company announced the acquisition of Pelit Su, the Turkey based natural spring water bottling plant with direct access to a natural spring water source. The company has taken over management control of the Turkish entity and has completed 100% equity acquisition in March 2012, with plans to expand its regional distribution footprint in Turkey. This strategic venture will also facilitate the Company’s entry into higher margin premium ’natural spring ‘drinking water in the UAE and other geography.

Rashed Mubarak Al Hajeri, Chairman of Agthia Group, said: “We are very satisfied with our performance for the year in light of the challenging environment for food & beverage manufacturers which, among others, has been characterized by increasing input costs and regional unrest. Nevertheless, business fundamentals remain strong as evident by the strong sales and volume growth across all categories during 2011 and this performance is consistent with our long term growth model.”

Ilias Assimakopoulos, Chief Executive Officer of Agthia Group, added, “Our investments remained focused on growth opportunities, while we continued addressing the challenge of higher input costs by pursuing cost savings initiatives, pricing opportunities, and by accelerating entry into new categories. We view such entries into new segments as strategic growth drivers and will contribute to Agthia’s ambition of becoming the UAE’s leading food and beverage group.”

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