Al-Jouf Agricultural studying projects to capitalize on infrastructure

Mazen Badawood, CEO of Al-Jouf Agricultural

Al-Jouf Agricultural Development Co. is studying several projects that fall within its transformation strategy in order to capitalize on the current agricultural infrastructure, said CEO Mazen Badawood.

In an interview with Argaam, the top executive added that his company is focusing on industrial products, which include olive oil and potato fingers, to boost its market share, as the company's decision to expand the potato fingers factory comes as part of this focus.

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Badawood said that the company reached maximum production capacity, following the expansion of the potato fingers factory, in less than two months after starting commercial production. Al-Jouf Agricultural continues to maintain this production capacity.

The factory expansion entailed increasing production by 50% from the current capacity, due to the strong market for potato fingers in Saudi Arabia, and strong competition from many manufacturers, especially from outside the Kingdom, the CEO said.

Al-Jouf Agricultural has strong agricultural infrastructure that helps it expand in the cultivation of raw potatoes with the best yields. This reduces cost price and allows the company to remain competitive and increase its market share, he added.

The top executive also pointed out that Al-Jouf Agricultural is contracting with the best international companies regarding this expansion and attracting the best international technologies.

He said that the increase in the company's Q2 net profit year-on-year (YoY) was driven by the 95% increase in sales, which rose to SAR 113 million from SAR 57.9 million in the prior-year period. This was mainly due to sales of the potato fingers product, launched in December 2023.

Moreover, olive oil contributed to the increase in Q2 sales YoY, said the CEO.

The olive oil factory production remains at maximum capacity to meet local demand, and maintain the company's leadership in the Saudi market as the largest producer of organic virgin olive oil in the Kingdom.

However, the decline in demand in Q2 quarter-on-quarter is due to seasonal factors, but it is still achieving growth compared to the same period last year, he noted.

The CEO also pointed out that the industrial segment is the main contributor to the company's profit, which supports its strategy of moving from being an agricultural company to an agri-industrial player.

He said that the company's expectations are positive for the third quarter of 2024.

Al-Jouf Agricultural reported a 96% leap in net profit to SAR 48.5 million in the first half of 2024, compared to SAR 24.8 million a year earlier. Q2 net profit amounted to SAR 15.6 million, data available to Argaam showed.