• Group net revenue +33% YoY to AED 4.07 billion with positive like-for-like growth across all verticals
• Revenue growth in excess of 70% from key Snacking and Protein verticals
• Net operating income +36% YoY, maintaining a profitable core while leveraging synergies and efficiencies
• Net profit +14% YoY to AED 247 million and Earnings per Share +9% (+14% YoY excluding Abu Auf acquisition)
Abu Dhabi, UAE, 07 March 2023 – Agthia Group PJSC, one of the region’s leading food and beverage companies, today announced results for the fiscal year ending 31 December 2022.
Agthia Group’s strategic vision is to be a leading food and beverage operator across MENAP and beyond by 2025. Agthia today has broader capabilities and is more robust and efficient than ever before.
• Agthia Group’s revenue footprint has expanded into 45 countries, with 51% of the revenue base now outside the UAE, compared with approximately 10% two years ago.
• Agthia Group’s product portfolio has transformed from a legacy base of water, flour, and feed to a balanced mix of over 35 value-add food and beverage brands in large, growing and scalable markets across four key verticals of Water and Food, Agri-business, Protein and Frozen, and Snacks.
• Increasing scale and diversification is giving Agthia more choice over how to optimize its product and channel mix, procure more favorably and drive cost and production efficiencies across the supply chain.
Agthia Group’s full-year 2022 results, in a challenging external environment, are testament to this.
• Group net revenue increased 33% year-on-year to AED 4.07 billion (+97% on a 2-year basis), with 22% growth from volume and 11% from pricing.
• In line with Agthia Group’ strategy to expand into high-growth verticals in large, scalable markets, full-year revenue contribution from the Consumer business division increased by 520bps to 75% of Group total, and revenue growth from the Group’s Snacking and Protein verticals exceeded 70%.
• Like-for-like (LFL) revenue growth was positive across all four verticals, with 9% growth at the Group level comprised of 12% and 13% LFL growth from Snacking and Protein respectively, and high single-digit growth from the Agri-business. Agthia maintained its market-leading position in UAE bottled water (27.4% value share across the retail channel).
• Gross profit increased 21% year-on-year to AED 1.2 billion, with the 273bps decline in gross margin incorporating an additional AED 270 million of commodity price inflation compared with the prior year.
• Agthia maintained its focus on productivity enhancement and disciplined management of costs throughout the period, with the resulting efficiencies supporting full-year EBITDA growth of 27% year-on-year to AED 578 million and net operating income growth (+36% year-on-year to AED 347 million) faster than revenue.
• Group net profit increased 14% year-on-year to AED 247 million, with earnings per share +9% year-on-year (or +14% excluding the contribution and associated costs relating to Agthia Group’s acquisition of Abu Auf in Q4).
• Strong profitability and proactive management of working capital supported good profit to cash conversion, with full-year operating cash flow of AED 316 million, and the Group’s balance sheet remained robust with cash and equivalents of AED 1.0 billion and net debt to EBITDA of 2.3x.
Good progress was made during the year in future-proofing the Group’s growth through investing in capability and innovation.
Strengthened Agthia’s leadership team: As part of its transition to a consumer-centric, performance driven environment, Agthia strengthened its leadership team through a number of key external appointments and internal promotions:
• Sherif Elfaham joined as Group Chief Financial Officer, bringing strong strategic, commercial, and operational experience across a range of consumer-facing businesses, having spent over 20 years with Unilever in the UK, North Africa, Middle East, and Turkey.
• Vandy Dos Santos joined as Chief Digital Officer, bringing over 30 years of experience in shaping and driving digital transformation across Abbott Pharma Division, the Nestle Group and, more recently, leading the Global Digital and Technology transformation of Heineken.
• Mubarak AlMansoori moved from his previous position as Agthia’s Chief of Human Capital and Corporate Services to the newly created role of President of the Group’s snacking business, spearheading growth in this important vertical. Mubarak continues to lead on Government Relations for Agthia, further entrenching his well-established relationships with regulatory agencies in the UAE and internationally.
• Abdulla AlMarzooqi was promoted to Senior Vice President of Human Capital, extending Agthia’s commitment to growing UAE national talent.
Finalized Agthia’s digital roadmap: Devised in conjunction with Bain & Company, this 5-year digital roadmap is intended to transform Agthia to a data-led, consumer centric organization through creating a digital ecosystem to deliver breakthrough customer experiences and insights across all channels, as well as a range of digital tools to optimize operational and process synergies across the Group.
Progressed Agthia’s sustainability agenda: We made continued progress across the four pillars of Agthia’s sustainability agenda, collecting 558 tons of recyclables through a sustainability-focused partnership with RECAPP.
• Agthia also reduced its water usage ratio and GHG scope 2 emissions by 2.6% and 4.3% respectively and, following recent legislative change, launched the UAE’s first locally produced 100% rPET water bottle at Gulfood in February 2023.
Invested in innovation: Innovation is the lifeblood of Agthia and plays a vital role in the Group’s strategic vision. Recognition of Agthia’s innovation and sustainability efforts came through several prestigious awards in 2022, including:
• Best of Middle East Innovation award at the Gama Innovation Awards for Freakin’ Healthy plant-based cheese, the UAE’s first locally produced Clean Label plant-based cheese.
• Gold and Silver awards at the Prime Awards for Al Ain water’s cutting-edge innovation in bottle labelling and development of the lowest gram per square metre corrugated box.
• Gold in Design & Innovation at the Prime Awards for Al Foah dates’ cost effective and flexible 5G packaging.
Khalifa Sultan Al Suwaidi, Chairman of Agthia Group, commented: “Agthia’s strong performance this past year, in a challenging external environment, clearly demonstrates management’s ability to acquire and consolidate value accretive businesses while leveraging synergies and maintaining a profitable core. I am confident that Agthia will continue to deliver value for all stakeholders in both the near and longer-term as it executes its strategy.”
Alan Smith, Group Chief Executive Officer, commented: “Strong revenue and profit growth over the past year, across both recently acquired and legacy businesses, is testament to the tireless efforts and agility of all our colleagues across the Group. Our strategy to acquire, integrate and grow attractive businesses in value-add categories continues to bear fruit, and two years into our transformative journey to a leading food and beverage company in the MENAP region and beyond, we are far bigger, more efficient and have greater capabilities than ever before. We will continue to remain focused and agile in our execution, and are, more than ever, confident in in the long-term growth trajectory of our business.”
The Company’s full-year 2022 results are available on the Company’s website www.agthia.com and at www.adx.ae