Abu Dhabi-based Agthia Group, a leading food and beverage company, has reported a net profit of Dh200 million ($54 million) for the first nine months of 2016, an increase of 12 per cent in comparison to the same period in 2015.

The company’s net revenues grew 11 per cent to Dh1.52 billion ($413.8 million), driven by a strong performance by the water business, with the Al Ain brand gaining its highest-ever volume and value market share at 25.3 per cent and 22.2 per cent respectively.

Eng Dhafer Ayed Al Ahbabi, chairman of Agthia, said: “Our results in the past quarter and overall in the first nine months of the year come directly as a result of our strategy to drive our core businesses both in the UAE and regionally, while successfully addressing the performance of our emerging businesses.”

“The market sentiment is likely to remain cautious for the coming year; however, our investments and our growth in market share ensure we continue to maintain our momentum, and our reputation, as a leading food and beverage company not only in the UAE but in the region as a whole,” he added.

The water business continued its exceptional growth trajectory, posting net revenues of Dh488 million ($132.8 million), an increase of 27 per cent over the same period last year, said a statement.   

Al Ain bottled water extended its lead in the UAE’s bottled water segment both in volume and value reaching a record 25.3 per cent volume share. Agthia also launched Ain Zero, a sodium-free product, in September to meet evolving consumer demand and respond to increasing consumer consciousness about health and wellness, it said.

The beverages category, consisting of Capri Sun fruit juices and Al Ain Fresh fresh juices, posted net revenues of Dh59 million ($16.06 million), it added.

Iqbal Hamzah, chief executive officer of Agthia, added: "We remain on track to grow both our top and bottom lines, despite the challenging economic environment and the impact of the subsidy rationalisation.”

“Water clearly continues to be a key driver of our growth, and the recent launch of Al Ain Zero has helped us to further reinforce our leadership in that segment,” he said.

“We expect our planned expansion into new markets will provide additional impetus for this crucial part of the business. Meanwhile, our balance sheet remains strong and healthy and we are well positioned to continue on our overall growth path,” he added.

Moreover, the dairy business, under the Yoplait brand targeted at the children’s and fruit yogurt segments, posted Dh24 million ($6.53 million) net revenues, up 34 per cent year-on-year.

Also new flavours, activation of additional digital marketing campaigns and strong marketing support spearheaded this growth against the trend of the segment, together with expanded distribution of plain yogurt in food service outlets.  

Agthia’s Flour business, including wheat trading, posted net revenues of Dh324 million ($88.2 million) during the nine-month period, an increase of 2 per cent against a year ago.

New product launches as well as continuous acquisition of new customers, higher distribution and visibility in retail trade resulted in share gains both in Abu Dhabi and the northern emirates.

Animal feed, another of the group’s five core businesses, posted net revenues of Dh520 million ($141.5 million), growing 1 per cent versus a year ago.

In the course of the third quarter, both flour and animal feed businesses were subject to a change in the subsidy regime that has been in place since 2007 in Abu Dhabi.

The company responded to these changes by immediately deploying initiatives to protect volume, ranging from the introduction of more competitive product lines to expanding distribution in especially the northern emirates and export markets, which helped partially mitigate the adverse impact on volume and profits.

Emerging businesses, which include tomato paste, frozen vegetables, ambient and frozen baked products in addition to dates and other convenience products, have continued their strong growth trajectory with net revenues increasing 31 per cent to Dh108 million ($29.4 million) versus the same period last year, it stated. – TradeArabia News Service