Almarai Company, the leading dairy producer in Saudi Arabia, has announced a 7.06% increase in net profit for the second quarter of 2023. The company’s net profit reached 557.08 million Saudi riyals ($148.45 million), compared to 520.36 million riyals in the same period last year.
The growth in profit can be attributed to higher revenue and improved operational efficiencies. Despite these positive results, Almarai faced some challenges due to increased funding costs aligned with SAIBOR interest rates.
In a statement, the company highlighted that stable trading conditions contributed to another successful quarter in Q2 2023. Almarai’s net profit for the first half of 2023 also experienced a significant year-on-year increase, rising by 26.71% to 1.19 billion riyals.
While the company acknowledges the potential risks associated with global cost inflation for dairy and feed commodities, it stated that prices have moderated compared to their peak levels in recent months. However, they still remain elevated compared to the previous year. To manage these risks, Almarai has implemented better hedging activities and leveraged its stock cover.
In April, the company’s shareholders approved a 10% cash dividend, demonstrating Almarai’s commitment to providing value to its investors.
Almarai’s solid financial performance in Q2 2023 reflects its continued position as the Gulf’s largest dairy producer. With its focus on operational efficiency and risk management, the company remains dedicated to navigating market challenges and delivering sustainable growth in the industry.