UAE food and beverages group Agthia said its net revenue in the first nine months of 2023 rose by 10.9 per cent to Dhs3.27bn year-on-year (YoY), driven by a robust performance from the snacking and agribusiness segments as well as a more competitive and price-sensitive backdrop in some markets.
The group’s snacking segment, product and packaging innovation in dates combined with a premiumisation shift in consumer demand is driving strong value growth across both UAE and international markets, Agthia said in a bourse filing.
“Agthia’s third quarter results demonstrate continued progress against strategic objectives, namely protecting the core business, reaping the rewards of recent value-accretive mergers and acquisitions, and investing in capability and innovation to deliver our vision to become a leading food and beverage company in the MENA region,” said the group’s chairman Khalifa Sultan Al Suwaidi.
Furthermore, Agthia’s water and food segment saw positive volume growth both in local and international markets, with notable performances from Saudi Arabia, Kuwait, and Turkey.
Agthia said adjusting for the impact of Egyptian currency devaluation on revenue, the group revenues increased more than 20.7 per cent YoY, with the growth of 46.5 per cent and 15 per cent respectively from the snacking and agribusiness segments.
The Abu Dhabi-based firm’s earnings before interests, taxes, depreciation and amortisation (EBITDA) reached Dhs465.1m in the nine months to September.
The snacking segment posted an EBITDA growth of 73.4 per cent, driven by strong performance in both domestic and international date markets.
Agthia reported a 12.7 per YoY increase in profit to Dhs205.6m, with the faster rate of growth relative to revenue reflecting EBITDA margin expansion as well as the cumulative repayment of Dhs928m of debt year to date (YTD).
The company’s balance sheet remained robust with cash and equivalents of of Dhs0.5bn. Its net debt to EBITDA ratio of 1.4x (net debt of Dhs0.9bn) was down from 2.3x as of December 2022.
Expanding Agthia’s capabilities
Meanwhile, Agthia is leveraging its Egyptian platform to strengthen its export-focused resource, with new food service volumes in both regional and international markets underpinning growth in export revenue from the North African country of 33 per cent YoY to Dhs55.6m.
The company continued to make progress across the four pillars of its sustainability agenda ahead of COP28 in Dubai later this month and, during the first nine months of 2023 water usage ratio was reduced by 8.6 per cent.
“We have transformed the food and beverage scene across the UAE and beyond. Since our inception in 2004 and the company’s listing on the Abu Dhabi Stock Exchange in 2005, our journey has been defined by growth and impact,” Alan Smith, the group CEO told Gulf Business in August.
ADQ-backed Agthia has made several acquisitions and investments across the Middle East to grow its regional footprint while contributing to the UAE’s food security strategy.
The group launched a $54m corporate venture capital fund, Agthia Ventures, in July to help food and beverage companies scale their operations and accelerate product development and market adoption.
Agthia Ventures, which is partially funded by ADQ, will be co-managed by US-based Touchdown Ventures, a US-based agency creating venture capital programs for corporations.