Mezzan Holding, one of the largest manufacturers and distributors of food, beverage, FMCG and healthcare products in the Gulf, saw revenues growing 14.5% to KD194.4 million ($635.8 million) over the 9-month (9M) period ending September 30, 2020.
The company posted an EBITDA (earnings before interest, taxes, depreciation, and amortisation) of KD21.4 million, up 21% and its net profit to shareholders of parent company grew to KD10.3 million in 9M, up 12%.
The group’s strong revenue growth was accompanied by enhanced operating profitability margins and leverage driving an increase in gross profit and EBITDA margins.
Net profits were further supported by a lower financing cost in Q3 2020 driven by a lower size of borrowing and a lower interest rate environment.
Mezzan Holding Executive Vice Chairman Mohammad Jassim Al Wazzan said: “Mezzan achieved healthy revenue growth driven by food and non-food FMCG and healthcare segments activity. We continue to report enhanced financial results despite the current challenging operating environment driven by improved results of our operations in the defence sector. The improved operating results and financial strength of the group reinforces our strategy to focus on our consumer-driven and healthcare businesses.”
Mezzan Holding CEO Garett Walsh said: “We are glad to see our financial results improve our topline and operating results as well as net profits. The group has recently implemented an expansion-driven strategy which has started yielding results. The enhanced profitability was driven by scale improvement and operating profit in addition to a reduced cost of financing.”
YTD 2020 Financial Performance Review:
Food Business Line:
Total Revenue for the Food Business Line reached KD129.5 million, an increase of 5.7% compared with the same period in 2019.
The Food Business Line accounted for 66.6% of Group Revenue. The Business Line comprises the following three divisions: Manufacturing and Distribution (generating 46% of Group Revenue), Catering (generating 13.6% of Group Revenue), and Services (generating 6.9% of Group Revenue).
Manufacturing and Distribution: Revenue increased 7.7%;
Catering: Revenue decreased by 1.0%;
Services: Revenue increased by 7.2%;
Non-Food Business Line:
Revenue reached KD64.9 million, an increase of 37.1% compared with the same period in 2019.
The Non-Food Business Line accounted for 33.4% of Group Revenue.
The Business Lines comprises the FMCG and Healthcare (generating 31.7% of Group Revenue) and Industrials (contributing 1.7%).
FMCG and Healthcare: FY Revenue increased by 41.2%, inorganic growth and heritage
Industrials: FY Industrials revenue decreased by 11.6%.
Regional Business Highlights in YTD 2020:
● In Kuwait: Revenue grew by 21.3% due to a strong performance in FMCG and healthcare segment spurred by acquisitions;
● In UAE: Revenue decreased by 1.9%, impacted by lower food service activity;
● In Qatar: FY Revenue decreased by 9.2%, driven by timed interruption of some operations;
● In KSA: Revenue increased by 5.8%;
● In Afghanistan: Revenue decreased by 6.6%;
● In Jordan: Revenue increased by 8.9%; and
● In Iraq: Revenue increased by 68.9%, driven by the food services segment.-- Tradearabia News Service