UAE food group Agthia seeks to build Egypt as export hub

Agthia Group

UAE food and beverages group Agthia is considering Egypt as an export hub after making acquisitions there as part of a regional growth strategy, group CEO Alan Smith said.

Agthia, majority-owned by the Abu Dhabi government through state investor ADQ, aims to be one of the Middle East’s leading players in the food industry by 2025.

“Our intent [in Egypt] is really now to bed those acquisitions, consolidate them and unlock the potential there to see how we can build Egypt as an export hub as well,” Smith told Reuters.

“We currently export around AED60 million ($16.3 million) from Egypt, but we’d like to accelerate that because we think there is a much bigger potential,” he said.

Last year Agthia bought 60 percent of Egyptian snacks company Abu Auf as part of a five-year market diversification and growth strategy. In 2021 it acquired a majority stake in Egypt’s Atyab meat company.

Smith said Agthia has around AED1.5 billion in firepower for acquisitions this year.

Turkish companies with export potential are also on Agthia’s radar, he said.

“We obviously want to balance that forex risk between the volatility of the economy in Turkey with the opportunity to use it as a manufacturing base for export,” he said.

Agthia’s acquisition strategy is focused on the Middle East, North Africa and Pakistan, but Smith said political and economic volatility had made Pakistan less attractive.

Agthia reported a net profit of AED247 million, a 14 percent increase on last year, in audited 2022 results on Tuesday.

Group net revenue rose 33 percent in 2022 year on year, to AED4.07 billion.

“In 2020, roughly 10-12 percent of our revenues were coming from outside the UAE. Last year, that number was 51 percent,” Smith said.

Agthia’s board approved cash dividends of 8.25 percent of share capital, equal to AED65.3 million, down from AED130.6 million in 2021.