Agthia Group net profit increases by 26 percent in first nine months of 2014

ABU DHABI, October 29 2014: Agthia Group PJSC, one of the UAE’s leading food and beverage groups, today reported continued sales and profit growth during the third quarter of 2014, driven by resilient performance of both the Consumer and Agri Business Divisions. Net profit for the first nine months of the year increased 26 percent to AED 151 million, driven primarily by higher sales and improved margins. Net sales increased by 9 percent to AED 1.2 billion for the first nine months of 2014 compared to the same period last year. H.E. Eng Dhafer Ayed Al Ahbabi, Chairman of Agthia Group commented: “We have seen a strong performance of the group in this quarter and the business is well positioned to sustain strong performance in quarters to come, both through organic growth and by seizing opportunities that arise in the UAE and in other markets.” Iqbal Hamzah, Chief Executive Officer of Agthia, added: “Without doubt this period has further consolidated the strong year Agthia has had so far, with both the Consumer and Agri Business Divisions continuing to perform well. We are addressing areas of underperformance and remain focused on driving the profitable growth of core businesses, while diversifying our product portfolio and widening our distribution reach.” The Agri Business Division, which manufactures and distributes Grand Mills flour and Agrivita animal feed products, recorded net sales of AED 782.3 million in the period, up 9 percent on the same period in 2013. This outcome was largely driven by volume growth of 17% year-on-year of poultry and large animal feed, supported by government initiatives to promote food security and encourage domestic food production which created favourable conditions for the segment. Net profit for Agri Business was AED 156.1 million, an increase of 19 percent year on year, resulting from higher volumes and improved margins. The improvement in the gross profit margin was the result of competitive sourcing of grains, ongoing cost saving initiatives, a favorable product mix, in-house production of previously outsourced animal feed and stable flour pricing in the Northern Emirates. Further expansion of poultry feed production capacity is underway with completion targeted by Q1 2015. Third quarter net sales in the Division reached AED 250 million, up 11 percent from the same period in 2013, and net profit rose 17 percent to AED 42.7 million. The Consumer Business Division, which produces and distributes products including Al Ain Mineral Water, Yoplait fresh dairy products and Capri-Sun juices, saw net sales of AED 450 million in the first nine months of the year, an increase of 10 percent over the previous year. Net profit also increased by 10 percent to AED 40 million. Third quarter net sales of AED 159.7 million were up by 17 percent, and profit at AED 17.7 million was 22 percent ahead year-on-year basis. Within the Division, the Water and Beverage segment achieved net sales of AED 362.3 million, up 8 percent, with net profit for the segment increasing 15 percent to AED 61.4 million and volumes increasing by 11 percent for the same period year on year for the segment. The growth was primarily driven by the improved performance of bottled water with the new high-speed bottling line helping to overcome previous capacity constraints and capitalising on cost saving opportunities. Alpin natural spring water in Turkey continued to increase distribution and gain market share, with sales in the domestic market doubling versus last year. Distribution plans for the UAE & GCC were delayed due to the high domestic demand in Turkey, and production capacity will be doubled by Q2 next year to meet this growing demand and to allow for supplies to the UAE market. The Food segment achieved net sales of AED 87.6 million in the first nine months of 2014, an increase of 22 percent, but recorded a loss of AED 21.4 million mainly resulting from input cost pressure and returns, higher marketing investment and the pre-operating costs related to the frozen baked category. The focus remains on improving profitability of the yogurt business by reducing costs, adjusting product and distribution strategy, and rationalizing plain yogurt portfolio. The frozen baked factory has commenced commercial production and the build-up of stock is in progress. Initially the Group is launching 20 SKUs which will increase to 50 by year end and to over 100 SKUs by 2015. The Group’s Egypt operation performed in line with expectation for the period, both in terms of sales and profitability. -Ends- About Agthia Agthia Group is a leading Abu Dhabi based food and beverage company established in 2004. The Company is listed on the Abu Dhabi Securities Exchange (ADX) and has the symbol “Agthia”. 51 percent of the Company’s shares are held by Senaat (General Holding Corporation), an Abu Dhabi Government entity, with the balance held by individual and institutional investors. The Company’s assets are located in the UAE, Egypt and Turkey. Agthia offers a world class portfolio of integrated businesses providing high quality and trusted food and beverage products for customers and consumers across the UAE, GCC, Turkey and the wider Middle East. Agthia employs around 2,000 employees and has two business divisions in various food and beverage segments: • Agri Business Division: UAE - manufacturing, distribution and marketing of Grand Mills, the leading high quality flour and Agrivita leading animal feed products; • Consumer Business Division: UAE - manufacturing, distribution and marketing of several brands including Al Ain Water, a leading bottled drinking water; Capri-Sun juices; Yoplait fresh dairy products. Egypt - Al Ain Pure Natural tomato and chilli paste, and fruit puree. Turkey - Alpin, natural spring bottled water. For more information, please visit www.agthia.com or contact: Reem Abu Namous Agthia Group Tel: 971 2 506 0600 Email: ir@agthia.com Charlotte Connerton Brunswick Group Tel: 971 4 446 6283 Email: AGTHIA@brunswickgroup.com


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