Mezzan Holding, a leading maker and distributor of food, beverage, FMCG, and pharmaceuticals, has posted a steep 73.9% plunge in its first half (H1) net profit to parent company shareholders netting just KD1.9 million ($6.2 million).
However, revenue was steady at KD134 million, unchanged compared to H1 2021 levels. Operating Profit registered a 63.7% dive to KD3.6 million, and EBITDA dropped to KD8.3 million, down 42.3%.
Mezzan Holding Vice Chairman, Mohammad Jassim Al Wazzan, said: “As expected, this has been a challenging period. The unprecedented geopolitical and macroeconomics volatility created a bumpy road and a tough landscape for the sectors in which we operate. Our gross margins dropped as rising input and operating costs outpace sales growth and price increases.”
Mezzan Holding CEO, Garrett Walsh, said: “We had a fair top-line number in the first half of 2022. Bottom-line results reflect the unusual environment and pressures seen in the sector locally, regionally and globally. The continued rise of Inflation levels during the half, particularly in raw materials, packaging and transportation costs, created more pressure on margin mix and operating costs than we expected. The group is adjusting and will balance the needs of our markets for value with a focus on delivering profit growth for our future.”
Food Business Line
Total Revenue for the Food Business Line reached KD88.5 million, an increase of 3.9% compared with H1 2021. The Food Business Line accounted for 66% of Group Revenue.
The Business Line comprises the following three divisions: Manufacturing and Distribution (generating 51.6% of Group Revenue), Catering (generating 9.8% of Group Revenue), and Services (generating 4.5% of Group Revenue).
Manufacturing and Distribution: Revenue increased by 9.6%; Catering: revenue decreased by 13.3%; Services: revenue decreased by 10.9%.
Non-Food Business Line:
Revenue reached KD45.5 million, a decrease of 6.9% compared with H1 2021. The Non-Food Business Line accounted for 34% of Group Revenue.
The Business Lines comprise the following divisions: FMCG and Healthcare business division (generating 31.5% of Group Revenue) and Industrials (generating 2.3% of Group Revenue).
FMCG and Healthcare: revenue decreased by 8.1%; Industrials: revenue increased by 13.3%.
Regional Business Highlights in H1 2022
In Kuwait: revenue decreased by 3.8% mainly due to the decline in Catering, and FMCG & Healthcare business lines.
In UAE: revenue increased by 21.6% due to the growth in salty snacks and energy drinks.
In Qatar: revenue decreased by 1.9% as catering business line revenue dropped
In KSA: revenue increased by 38.1% as Mezzan continues to expand its product mix.
In Jordan: revenue increased by 16.7% due to the successful launch of KITCO salty snacks.
In Iraq: revenue increased by 5.3% despite the decline in business activities caused by US troop’s withdrawal from Iraq.-- TradeArabia News Service