Bakery drives Almarai third-quarter profits

“Strong performance” in bakery and poultry helped Saudi food firm Almarai to an increase profits in the three months ending 30 September.

Almarai said that third-quarter profits were up 4.7% to SAR450 million ($120 million) and operating profit rose 6.6% to SAR508.6 million. Sales surged 27% to SAR2.67 billion.

The firm added that its results were boosted by the acquisition of a majority stake in its dairy and juice joint venture with PepsiCo. Almarai upped its share of IDJ from 48% to 52% in March.

However, Almarai fell short of hitting expectations of analysts, who had predicted that the firm would book profits of SAR469 million.

“The net profit has been reduced by continuous high material costs resulting from on-going erratic commodity prices, and also persistent increase in overhead costs due to the expansion in new projects,” said an Almarai statement.

In May, Almarai’s board green-lit a $4.2 billion five-year investment programme to drive innovation and develop its Saudi workers.