Karachi July 21 2023: Fauji Foods Limited (FFL) reported profit for the first time as sales grew 95 percent year on year with gross margins of more than 12 percent and lower finance cost.
“FFL achieved its first ever PAT positive (PKR 22 mn) quarter in Q2 2023. In fact, it was 4th consecutive month in Green by the company. With the first half revenue of PKR 9.8 bn (+ 105% over SPLY) the business is all set to achieve the turnaround” says Company Chairman Waqar Ahmed Malik.
Nurpur continues to drive growth (+51% SPLY). The revamped Route to Market has fueled the increase in distribution (+ 14,000 outlets vs SPLY). The strengthening of brand has enabled Nurpur to navigate inflation through pricing. The institutional business forms the other key pillar of growth strategy and it grew by 202% over SPLY.
The commercial sustainability is reflected through improved structure of the P&L as Gross Margins increased from 3.7% H1 2022 to 12.5% in H1 2023. This was driven by continued focus on cost efficiencies backed by twin sustainability projects of 1 MW solar and bio mass which went into production in Q1 and are expected to positively impact energy cost in 2023. These initiatives along with price increases & other planned cost optimizations yielded an additional 8.8% Gross Margin. As a result, FFL achieved operating profit of PKR 190 mn vs PKR (708) mn loss in SPLY, an increase of PKR 898 mn. With a solid turnaround strategy delivering results, the EBIDTA which has been on a growth path since Q422 surged to PKR 448.4 Mn in H123, a 197% growth over SPLY.
Looking ahead, the investment in brands and distribution infrastructure should continue to fuel the growth. With the legacy debt burden now removed from the books, the growth in Margins and EBIDTA will help grow the business even faster whilst introducing new products. The strategy of pivoting to value added portfolio will enable the business to cover the expected inflation through pricing & margin management. We are confident that FFL driven by its vision of “Unleashing Pakistan’s promise in everything we touch” will not only build a successful business but leave a mark on the broader national landscape for times to come.
Fauji Food Limited Reported First Ever Profit on Robust Sales
Karachi July 21 2023: Fauji Foods Limited (FFL) reported profit for the first time as sales grew 95 percent year on year with gross margins of more than 12 percent and lower finance cost.
“FFL achieved its first ever PAT positive (PKR 22 mn) quarter in Q2 2023. In fact, it was 4th consecutive month in Green by the company. With the first half revenue of PKR 9.8 bn (+ 105% over SPLY) the business is all set to achieve the turnaround” says Company Chairman Waqar Ahmed Malik.
Nurpur continues to drive growth (+51% SPLY). The revamped Route to Market has fueled the increase in distribution (+ 14,000 outlets vs SPLY). The strengthening of brand has enabled Nurpur to navigate inflation through pricing. The institutional business forms the other key pillar of growth strategy and it grew by 202% over SPLY.
The commercial sustainability is reflected through improved structure of the P&L as Gross Margins increased from 3.7% H1 2022 to 12.5% in H1 2023. This was driven by continued focus on cost efficiencies backed by twin sustainability projects of 1 MW solar and bio mass which went into production in Q1 and are expected to positively impact energy cost in 2023. These initiatives along with price increases & other planned cost optimizations yielded an additional 8.8% Gross Margin. As a result, FFL achieved operating profit of PKR 190 mn vs PKR (708) mn loss in SPLY, an increase of PKR 898 mn. With a solid turnaround strategy delivering results, the EBIDTA which has been on a growth path since Q422 surged to PKR 448.4 Mn in H123, a 197% growth over SPLY.
Looking ahead, the investment in brands and distribution infrastructure should continue to fuel the growth. With the legacy debt burden now removed from the books, the growth in Margins and EBIDTA will help grow the business even faster whilst introducing new products. The strategy of pivoting to value added portfolio will enable the business to cover the expected inflation through pricing & margin management. We are confident that FFL driven by its vision of “Unleashing Pakistan’s promise in everything we touch” will not only build a successful business but leave a mark on the broader national landscape for times to come.
