Egyptian cheese maker Arabian Food Industries Company (Domty) saw its net profit fall 3.8% quarter-on-quarter due to foreign exchange losses caused by the devaluation of the pound and rising global inflation.

Net profit for the first three months of the year reached 50.5 million pounds ($2.7 million), compared to 52.5 million in the fourth quarter of 2021, but an improvement on the loss of 3, 4 million pounds from the previous year.

“Net income (Q1 2022) was impacted by foreign exchange losses of approximately EGP 12 million resulting from the devaluation of the Egyptian pound which occurred at the end of March,” the company said in a statement. London Stock Exchange (LSEG).

“Our raw material costs are (also) suffering from global inflation… We are doing our best to gradually pass on price increases to end consumers so as not to negatively affect demand,” the US-based company said. Egypt, which manufactures a range of white and processed cheeses and branded juices.

According to the latest S&P Global Egypt Purchasing Managers’ Index, non-oil business conditions in Egypt continued to deteriorate in May as mounting price pressures continued to weigh on spending. The country’s PMI came in at 47.0 in May, an improvement from 46.9 in April, but still below the 50.0 threshold.

Revenue

Despite the pressures of currency devaluation and global inflation, Domty noted that its revenues were still up 73% year-on-year, driven by higher sales in the dairy, bakery and snacks segments. juice.

Sandwich and cottage cheese sales volumes jumped 53.2% and 42%, respectively, while juice and mozzarella sales increased 26.5% and 11%.

The company said it was “pleased” with the results, citing that its profits were held above 50 million pounds for the third quarter in a row.

(Reporting by Cleofe Maceda; editing by Seban Scaria)

Cleofe.maceda@lseg.com