Alamar achieves positive trajectory on growth and margins; with positive outlook for H2 performance: CEO

Filippo Luciano Sgattoni, CEO of Alamar Foods Company

Alamar Foods Company is on the right track, as it reported growth and better margins in the second quarter of 2023, CEO Filippo Luciano Sgattoni said, expecting this momentum to continue in the coming period with positive performance in H2 2023.

Although the first-half results did not match last year’s sales and profitability, a positive performance outlook is expected in the second half of the year, Sgattoni told Argaam in an exclusive interview.

Alamar achieved growth in Egypt and was successful in localizing most of its ingredients. This is aimed at mitigating the risk of currency fluctuations and import challenges, in addition to enhancing the company’s business and maintaining a strong financial position.

The impact of the currency devaluation started from H2 2022, the CEO noted, expecting a lower impact in H2 2023.

The company continues to work on its growth and margin improvement plan considering the impact from inflation and currency devaluation in Egypt and Lebanon, Sgattoni said, adding that inflation is expected to ease in the second half of the year.

Sgattoni explained that growth and cost efficiencies will support the gross profit improvement, which will deliver a sustainable value to shareholders.

Capital expenditures are stable at 6% of sales, and the company is debt-free with positive operating cash flows. The company distributes dividends on quarterly basis.

Alamar continues to focus on its geographical presence, while ensuring the efficiency of capital expenditures to generate strong cash flows.

Further, Sgattoni added that the Company focuses on the same store sales growth and the geographical expansion, while continuing to improve the operational efficiency.

Alamar plans to open new stores in the second half of 2023 mainly in Saudi Arabia and the UAE, the CEO said, adding that the store count at Group level reached to 670 at the end of H1 2023.

He indicated that Alamar's financial strength and experience would help the Company in exploring merger and acquisition opportunities, noting that the addition of complementary brands to the group is part of the Company’s growth plan.

Touching on the food and beverage segment, Sgattoni said that the segment is witnessing considerable growth, highlighting the importance of addressing new customers behavior, and building on the Company’s continuous efforts in new product development and leveraging technology, he added.