Tanmiah 2021 net profit dips 82% to SAR 13.6 mln; Q4 loss at SAR 12.4 mln

Tanmiah Food Co. reported a net profit after Zakat and tax of SAR 13.6 million for 2021, a slump of 82% from SAR 74.4 million in the year-earlier period. 

The lower profit was attributed to a rise of 34.4% year-on-year (YoY) in the cost of sales. Selling, general and administrative expenses (SG&A) also increased by 39.45% YoY to SAR 277.57 million along with finance cost that rose 2.6% YoY to SAR 26.4 million.

Moreover, Tanmiah incurred some pre-operating expenses for the newly-established subsidiary, Gulf Brand for Fast Food Company to operate franchise business of POPEYES®. 

In Q4 2021, the company swung to a net loss of SAR 12.36 million against a net profit of SAR 30.38 million in the year-ago period. 

The loss came due to a drop of 18.86% YoY in gross profit, an increase of 24% YoY in the cost of sales. SG&A was also 43% higher YoY to SAR 74.8 million, along with the pre-operating expenses incurred by the company for the newly-established subsidiary, Gulf Brand for Fast Food Company to operate franchise business of POPEYES®.

Tanmiah sustained losses compared to a net profit of SAR 3.7 million in Q3 2021.

Shareholders’ equity, excluding minority rights, rose to SAR 356.2 million in 2021, from SAR 347.5 million a year earlier.

Tanmiah reported a full-year revenue of SAR 1.54 billion, up 27% from SAR 1.21 billion in 2020.

It plans to further expand its capacity to serve growing local and regional demand. The planned capital expenditure in the next five years will be allocated for increasing feed milling, primary processing. Further processing capacities are intended to allow the company to capture new and emerging growth opportunities.

The company’s capital investments are expected to lead to higher revenue and margins due to the premium that end consumers are willing to pay for fresh domestically produced chicken meat. The recent expansion of Tanmiah’s sales team will also support this growth.

Diversification efforts will also include growing Tanmiah’s food franchise operations business, which was introduced in 2021 and cemented an agreement with POPEYES®, with new restaurants set to open in the Kingdom in coming years.

View More Financial Results