Savola Group, the Saudi Arabia-based food conglomerate, posted a 21.8 per cent year-on-year rise in its first-quarter net profit to SR295.2 million ($78.72 million), it said on Saturday, exceeding analysts' expectations.

The company attributed the increase in profits to higher revenues from food, especially edible oil, growth in sales and increasing its retail market share, it said in a statement on the Saudi bourse.

Commenting on the growth, Group managing director Dr. Abdulraouf M. Mannaa said the increase in the net income was mainly due to stronger revenue growth in the foods sector (locally and overseas), led by the edible oils segment, and continued sales growth and increased market share in the retail sector (Panda Stores).

"As a result, the group’s revenues for the quarter reached SR7.2 billion, up 9 per cent compared to SR6.6 billion for the same quarter last year. This is the highest recorded net income from the group’s operations for Q1 since its inception in 1979," Dr Mannaa noted.

He also pointed out that this was the eighth successive quarter (since Q2 2011) in which the Group had posted its highest recorded net income from operations for a particular quarter "thanks to its strategy of focus and sustainable growth."

The firm, which owns the Middle East's biggest sugar refining business, said it expects to make net profit of SR365 million in the second quarter.

Analysts expected Savola to make profit of 265.11 million riyal in the first quarter.

In a separate statement, Savola said it plans to pay 0.50 riyal per share in dividends totalling SR250 million in the first quarter.-Reuters and TradeArabia News Service