Sadafco's net profit surges to $14.6m in Q3
RIYADH, December 1, 2018
Saudia Dairy and Foodstuff Company (Sadafco) has announced that its net profit for the three-month period ending on September 30 surged to SR54 million ($14.6 million) on lower international commodity prices combined with favourable sales growth across its various categories.
The company registered an increase of SR4 million compared to the last quarter, on the back of 4.6 per cent higher sales.
Announcing the results, CEO Wout Matthijs said despite the current challenging market environment, Sadafco continues to strengthen its premium branded position and realise its financial goals.
“We are also focused on investing in expanding our future product portfolio, which will further contribute to our success in the years to come,” he noted.
In the half year, April to September 2018, net sales were down 6 per cent excluding Melkoma, resulting from multiple headwinds (expat departure, higher labour costs, higher cost of living and lower consumer confidence).
"In addition, the domestic milk category has a glut of supply driving irrational price discounting by our customers, which we have sought to contend with," noted Matthijs.
During the last quarter, the Saudi dairy company had acquired 76 per cent of the Polish dairy powder producer Mlekoma Group for a transaction valued at SR120 million.
The acquisition will contribute towards delivery of powdered raw materials and blended semi-finished goods mixes for our use in the future, it stated.
"Strong working capital ratios and free cash of SR484 million with zero debt, following our acquisition, meant Sadafco will continue to enhance shareholders value," said the top official.
Shareholder equity for the period was valued at SR1.34 billion, a 1 per cent increase in comparison to SR1.321 billion for the same period last year.
Furthermore, Sadafco is expected to launch the new Jeddah Central Warehouse by the end of 2018. The project, worth SR145 million, is expected to deliver future cost savings and improved effectiveness in the company’s supply chain, it stated.
Established in 1976, Sadafco is a leader in dairy and foodstuff manufacturing, importing, distributing and marketing in Saudi Arabia and has established a strong reputation and loyal following in the food and beverage industry across the GCC region.-TradeArabia News Service
