Abu Dhabi’s food company Agthia Group, is on track to launch new product line after reporting a 25 per cent drop in its net profit to Dh40 million in the six months ending June 30 , 2011 which was caused by the spike in the grain prices.
The challenges of rising soft commodity prices, pressuring “our profit margins, while the repercussions of the recent regional unrest remain a concern,” the company said in its outlook for the year. The Company remains focused and committed to growing its existing businesses; effectively executing commencement of new category launches in fresh dairy products, long shelf life natural juices and processed fresh fruits and vegetables; and expects to deliver another year of good business growth.
In the last six months, Agthia has maintained its growth momentum in all categories, registering a 17 per cent increase in year on year net sales, reaching Dh559 million. Among the key highlights during the period, food company’s Water & Beverages segment achieved sales growth of 26 per cent to record Dh155 million, while the Flour and Animal Feed segment grew 14 per cent year on year to achieve Dh376 million.
The Company recently completed its flour mill expansion project, anticipating a similar expansion in its Animal Feed mill to be completed by Q4 2011, which will improve profitability.
Rashed Mubarak Al Hajeri, Chairman of Agthia Group was happy with his food company’s sales and volume growth momentum. He said the rising input cost was a challenge. However, the Company is “progressing well in line with its long term strategy to deliver business growth along with expansions into new categories.”
Ilias Assimakopoulos, Chief Executive Officer of Agthia, explained that the new strategic initiatives announced in 2010, to launch fresh dairy products under the Yoplait brand, and expansion into processed fresh fruits and vegetables, as well as launching long shelf life juice segment under the Chiquita brand are all progressing well and are “on track.”
“We remain focused on investing in growth opportunities, while we continue to address the challenge of higher input costs,” the chief executive said.
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