Agthia Group Delivers Strong Performance, Surpassing Guidance Ranges in 2023 Preliminary Results

 -Group net revenue + 12.1% YoY to AED 4.6 billion (ahead of full-year guidance range of 10-12%); LFL revenue +5.7% YoY

 Agthia Group PJSC (“Agthia” or “the Group”), one of the region’s leading regional food and beverage companies, today announced its preliminary and unaudited results for the fiscal year ending 31 December 2023. 

Group net revenue increased 12.1% year-on-year to AED 4.6 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% year-on-year growth. Group like-for-like (LFL) revenue growth was 5.7% year-on-year, with Agri (+19.9% YoY) and Water & Food (+6.0% YoY) being major contributors of growth during the period.

EBITDA rose 21.1% year-on-year to AED 689 million during the reporting period, with the EBITDA margin expanding +113bps (exceeding the guidance range of 40-60bps) to 15.1%. 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% year-on-year to AED 342.2 million, expanding net profit margin by +80bps (exceeding the guidance range of 30-50bps) to stand at 7.5%, notwithstanding further FX and interest rate headwinds throughout 2023. Reported group net profit1 increased 9.9% year-on-year at AED 299.6 million (one-off1). 

Underlying earnings per share1 (EPS) rose 23.0% year-on-year to AED 0.384, while reported EPS1 grew 5.8% year-on-year to AED 0.330.

Snacking revenue grew 38.0% year-on-year (+9.3% 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 AED 546 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% increase in FY’23 local currency revenue.

Water & Food revenue grew 6.0% 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% 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 AED terms, amid the challenging macro and consumer environment of 2023, which included the significant devaluation of EGP. 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% 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 AED 6.6 billion as at 31 December 2023, with total shareholders’ equity2 of AED 2.9 billion.

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.”