Among the drivers of significant year-on-year increases in revenues and profit for the last three months have been higher sales of fresh poultry, according to Tanmiah Food Company.
In its report for the second quarter of the fiscal year (to June 30, 2024), the group also attributes improvements to a broader geographical coverage, more focused marketing, and expansion of its sales channels. Positive developments were seen across all its business segments — namely fresh poultry, feed, animal health, and its fast-food franchise.
At almost 640 million riyals (SAR; US$171 million), the group’s total sales revenue for the reporting period was up 28% year-on-year.
Despite an increase in production costs from the comparable period in 2023, Tanmiah recorded a 55% improvement in gross profit to just over SAR164 million. This increase was driven by the rise in revenues, the firm says.
At SAR42.8 million, operational profit has almost doubled compared with the same three-month period of last year. Net profit attributable to the company’s shareholders was 111% higher year-on-year at SAR24.0 million for the reporting period.
These strong quarterly figures feed into Tanmiah’s results for the first half of the current year. At over SAR1.22 billion, sales revenue is 24% higher than at the same point in 2023. Gross profit was reported up almost 37% at SAR309 million, and operational profit was 42% higher year-on-year at SAR82.3 million.
Higher revenue across all business segments
Accounting for 77% of Tanmiah Food Co’s total sales, Fresh Poultry is the major contributor to the group’s total revenue. For the second quarter, this segment generated sales of just under SAR491 million. This year-on-year increase of 18% was attributed, among other drivers, to expanded production capacity.
Strong demand for animal health product and equipment were reported to have driven a near-100% increase for the firm’s feed and animal health operation to almost SAR118 million
Third of Tanmiah’s operations is its fast food franchise, which has grown steadily since it launched Popeyes in Saudi Arabia in 2021. For the latest three months, operator revenue reached SAR31.2 million. This was 56% higher than in the comparable period of last year.
Over the past three months, Tanmiah opened its first Popeyes store in Bahrain in addition to six more in Saudi Arabia. These bring its total outlets to 61, and further stores are planned across the Kingdom.
More on Tanmiah Food Co.
Based in Saudi Arabia, Tanmiah Food Co. is among the largest poultry companies in the Middle East, according to WATTPoultry.com’s Top Poultry Companies survey. This source puts the company’s annual slaughterings at just under 122 million chickens, which places Tanmiah seventh in the regional rankings.
U.S.-based fast food company Popeyes Louisiana Kitchen (Popeyes) has recently reported rapid expansion in the number of outlets in countries outside its base. With annual sales now surpassing the US$1-billion mark, Popeyes highlights recent moves into Kuwait and Bahrain as key drivers for this expansion. Opening of these two Middle Eastern markets is the result of a new agreement between Popeyes and Tanmiah Food Co.
Earlier this month, Tanmiah Food Co. agreed two Shariah-compliant loans totaling SAR320 million with different banks. The company reports these will be used to support sustainable growth and development for its subsidiaries, Agricultural Development Company (ADC) and Desert Hills Veterinary Services (DHVS). To meet their working capital requirements, the one-year credit facilities are with Alinma Bank (SAR200 million), and the National Bank of Kuwait (SAR120 million).
Tanmiah Food Company is the agricultural holding company for Al-Dabbagh Group, according to the group’s web site. Tanmiah is the parent company for three operations. Of these, ADC produces and distributes fresh, frozen and ready-to-cook chicken meat products under the brand name “Tanmiah.” DHVS produces and distributes animal feeds, day-old broiler chicks and hatching eggs, as well as selling animal health products and livestock equipment. Tanmiah Food’s third subsidiary is Supreme Foods Processing Company. It produces a range of added-value and cooked meats from two factories in Saudi Arabia, and Perfect Foods Factory, which is located in the United Arab Emirates.
