First Mills’ H1 results reflect strong demand, feed segment drives topline growth: CEO

“We continue to monitor demand levels as part of our sales and operations planning processes, while maintaining operational flexibility that enables us to respond to changing market conditions. Additional production capacity from the new flour mill, expansion in the animal feed segment, and growth in export activities are key factors supporting our growth outlook,” said the top executive.

He explained that First Mills is focused on executing its strategy by improving operational efficiency, expanding value-added products, strengthening its distribution network, and efficiently managing costs and the supply chain, supporting sustainable long-term growth.

The company continued to implement its strategic plan during the first half of the year to enhance integration across the value chain and expand production capacity in both the food and animal feed segments, said Ababtain. He noted that the launch of the new flour mill at the Qassim branch, with production capacity of 600 tons per day, boosted demand and growth in value-added products.

He explained that the H1 2026 increase in net profit reflects strong operating performance, supported by higher sales, improved profitability, and continued disciplined investment in growth opportunities. Revenue growth was driven by the expansion of the animal feed segment and sustained demand for flour products.

Gross profit also soared during the six-month period as a result of an improved product mix, expansion in value-added products, pricing discipline, and effective cost management. Further, selling and distribution expenses surged given the expanded commercial activities and investment in business growth; however, higher gross profit and operating discipline helped absorb the resulting impact, according to the CEO.

Ababtain noted that the flour segment remained the company's largest revenue contributor, while the animal feed segment was the fastest-growing driver of revenue during the second quarter of this year.

The flour segment revenue reached SAR 170.6 million in Q2 2026 and SAR 346.7 million in H1 2026, representing YoY growth of 22.2% and 11.8%, respectively. This was supported by continued demand across industrial, commercial, and corporate channels, alongside moderate growth in volumes sold and disciplined pricing of small-pack products, said the top executive.

Meanwhile, the animal feed revenue increased by 78.7% YoY in Q2 2026 to SAR 101.9 million, and by 68% in H1 2026 to SAR 231.2 million. The increase was driven by expanded production and distribution capacity following the acquisition of Al Manar Feed and Al Kinan Al Arabia Trading, as well as the development of specialized products and the improved operational efficiency, he added.

The CEO further explained that the YoY growth in animal feed revenue during the second quarter reflects continued expansion year-on-year, backed by increased production and distribution capacity, improved capacity utilization, and an evolving product mix.

However, the quarter-on-quarter comparison with the first quarter is affected by the nature of the business and differences in the comparison base. “The segment's performance should instead be assessed based on key operating indicators, particularly revenue growth, expansion of the distribution network, development of specialized products, and sustained demand from the poultry sector,” he continued.

Ababtain also emphasized that the animal feed segment has several structural growth drivers, including leveraging the acquisitions of Al Manar Feed and Al Kinan Al Arabia Trading, enhancing value-chain integration, expanding specialized products, and launching animal feed exports for the first time. These initiatives are expected to support higher production capacity utilization.

“We are set to continue developing the animal feed segment while maintaining pricing discipline, managing costs, and improving operational efficiency,” said the CEO.

Regarding geopolitical developments, Ababtain said First Mills maintained stable operations during the period by adopting a proactive approach to supply chain and risk management.

This included diversifying sourcing channels, maintaining appropriate levels of safety stock for raw materials, continuously monitoring shipping networks and alternative logistics routes, and maintaining regular communication with suppliers and logistics service providers to anticipate any potential disruptions, he added.

The CEO also noted that First Mills also strengthened its sales and operations planning processes, conducted ongoing risk assessments, and implemented comprehensive contingency plans. He confirmed that the company did not experience any material impact during the second quarter on production, product deliveries, or inventory availability.

According to Argaam’s data, First Mills reported a net profit of SAR 146 million in H1 2026, an increase of 11% compared with SAR 131.1 million in H1 2025. The Q2 net profit reached SAR 65.9 million, up 28% YoY.