SADAFCO’s Q3 2022/23 lifted by higher profits from distribution channels: CEO

Patrick Stillhart CEO of SADAFCO

Saudia Dairy and Foodstuff Co. (SADAFCO) posted a 43.5% leap in Q3 2022/23 net profit, backed by a 25.8% rise year-on-year (YoY) in sales as the company focused on sales efficiency, improved distribution methods and better profitability from distribution channels, CEO Patrick Stillhart said.

In an interview with Argaam, Stillhart said the third-quarter profit was also buoyed by other factors, including a 14.2% drop YoY in selling and distribution expenses, compared to a 14.1% decline in Q3 2021/22. SADAFCO also maintained a 30% profit margin and reduced general and administrative expenses by 4.2% as a percentage of sales, thanks to cost efficiency initiatives.

Financing income also increased by SAR 2.9 million, driven by higher returns from Murabaha deposits, Stillhart added, noting that deposits of over a three-month term were made to deliver higher returns.

SADAFCO held robust market shares with 61.5% of long-life milk, tomato paste (53.9%) and ice cream (29.5%). In November 2022, the company recorded the highest monthly market share in ice cream with 31.2%, after introducing two new dairy vanilla-flavored products.

For the French fries project, the CEO added Wafrah for Industry and Development Co. started to deliver French fries almost five weeks ago, expecting this to align with SADACO’s aspirations to use the largest possible number of Saudi products.

Elsewhere, Stillhart said Mlekoma reports low profit margins. However, the year 2022 was exceptional in terms of profitability, due to a rise in the prices of basic commodities.