Saudi food industry sees buoyant demand, growth momentum to improve in Q1 2024: Almunajem CEO

Thamer Abanumay, CEO of Almunajem Foods Co.

The demand levels in Saudi Arabia’s foods industry are strong and the momentum will likely continue over the coming period due to population growth, tourism, and Hajj and Umrah programs, Thamer Abanumay, CEO of Almunajem Foods Co., told Argaam.

However, inflation levels and unstable supply chains weigh on prices, he added.

The sector’s growth is forecast to continue through Q1 2024, backed by the seasonal demand in Ramadan.

Almunajem’s Q4 2023 performance reflected higher revenue, positive growth across all sales channels as well as categories, improved profit margins for some food categories, compared to the prior year period, which was impacted by the supply chains crisis then, Abanumay added.

Almunajem reported an all-time high revenue exceeding SAR 3.3 billion in 2023 and further improved the working capital efficiency ratio to reach 14%. Additionally, it generated free cash flows (FCFs) at SAR 400 million last year, and reported positive growth in sales volumes year-on-year (YoY) in Q4 2023 especially in the Western region.

The Golden Chicken sales volumes accounted for 1.1% of Almunajem’s Q4 2023 gross sales, noted Abanumay, expecting the company to report higher sales of these food categories in 2024.

As for the potential acquisition of Balady Poultry Trading Co., Abanumay indicated that the company is conducting the due diligence, and any relevant updates will be duly revealed.

Almunajem’s net profit declined 3% to SAR 282.2 million in 2023, from SAR 290.2 million in the year-earlier period. The fourth-quarter earnings came in at SAR 81.6 million, data compiled with Argaam showed.