25 October 2022, Dubai, United Arab Emirates: Saudia Dairy and Foodstuff Co. (SADAFCO), the leader in the UHT (long life) milk market in the Kingdom of Saudi Arabia reported strong financial results for the second quarter of the financial year 2022/23.
SADAFCO reported a significantly higher net profit of 12.4 percent compared to 10.1 percent in the previous quarter and 31 percent higher from the same quarter in the previous year due increased focus on sale of high margin SKU’S primarily in ice cream (25%) and milk (28%) and tomato paste (28%); production efficiencies in Jeddah factories through automation and prudent sourcing of raw materials and enhanced penetration in the market.
Despite the inflationary pressures that persist across the business globally, SADAFCO are cautiously optimistic regarding the decline of inflationary trend in the raw materials as the net profit for this quarter is SAR 86Mln which increased by SAR 29.8Mln (53%) compared to last quarter due to 10% higher sales.
Whilst inflationary pressures persist across the business world, we are cautiously optimistic to see a decline in the inflationary trend for raw materials. Selling & distribution expenses were reduced from 14.4 to 11.5% in comparison to the same period in the previous year but were higher in value. Total shareholders’ equity is at a healthy rate of 1.582Bln in comparison to 31 March 2022 when the rate was 1.540Bln.
Patrick Stillhart, CEO, SADAFCO said: “Our progressively strong financial results reflect the strength of the Saudia brand and the prudent decision making by the Board and the management. Our market shares remain robust with positive trending lines: UHT Milk 61.3%, Tomato Paste 54.2% and Ice cream 29.1%. We continue to delight our consumers through new offerings especially in the ice cream and dairy categories. Whilst inflationary pressures persist across the business world, we are cautiously optimistic despite the inflationary conditions. Our focus on ESG continues with initiatives relating to reduction of electricity through solar panels, water saving and recycling of water and packaging materials. “
As SADAFCO continues to enhance its capabilities to meet future demands and as part of their growth strategy, a new depot was opened in Al Kharj, the 20th depot in KSA, potentially generating additional revenue. The project of Makkah Depot SAR 27 Mln is in progress and is expected to finish in the current Financial Year.