Saudi Arabia's Almarai Co, the Gulf's largest dairy company by market value, posted its slowest profit growth in at least a year in the first quarter as it boosted investment.
Net profit in the three months to March 31 rose 32.1 per cent to SAR162.2 million ($43.3 million; Dh158.9 million), or SAR1.49 per share, compared with SAR122.8 million (Dh120.47 million), or SAR1.13 per share, in the year-earlier period, Almarai said in a statement on the Saudi bourse website.
That was the slowest pace of growth since the fourth quarter of 2006, according to Reuters data, and compares with as much as 52 per cent in the third quarter last year.
"This (32.1 per cent) rise is due to investments by the company to increase its capacities and its competitiveness as indicated in the firm's strategic plans," Almarai said in the statement.
Turnover climbed 38.7 per cent to SAR1.12 billion and operating profit 34.5 per cent to SAR194.5 million, it said.
In the second quarter, Almarai started consolidating the earnings of Western Bakeries and International Bakery Services Co, which it agreed to buy in November the previous year. It paid SAR709 million in stock for the companies.
Almarai is investing SAR4.7 billion during the five years to the end of 2011 to boost its foodstuff business in the Gulf, the company said last year.
Analysts' forecasts for first quarter earnings ranged from SAR152.7 million to SAR197 million, according to a Reuters survey last month.
The dairy firm is part of a group led by Kuwait's Mobile Telecommunications Co (MTC) that will this year start operations as Saudi Arabia's third mobile phone firm. The group paid $6.1 billion (Dh3.68 billion) for the licence. (Reuters)
Almarai Q1 profit growth slows on investment