The strategy focuses on expansion and growth into value-add categories, through disciplined M&A’s, driving improved financial performance
Agthia Group PJSC revealed its long-term strategy to become an F&B leader in the Middle East, North Africa and Pakistan (MENAP) region and beyond by 2025. The strategy is built on three strategic pillars, namely growth, efficiency and capability, and is designed to extend the Group’s market leadership, provide significant value for all stakeholders and continue to drive profitability growth with a consumer-centric approach.
The Abu Dhabi-based organisation is engaged in manufacturing, distribution and marketing of a wide range of F&B products, including popular regional brands such as Al Ain (water), Al Foah (dates), Al Faysal Bakery & Sweets (bakery) and Grand Mills (flour and bakery) among others.
Khalifa Sultan Al Suwaidi, Chairman, Agthia Group, said: “One of Agthia's primary strengths lies in its resilient, balanced and progressive business model. As one of the pioneers in the industry, and to strengthen our position as a regional leader, the Agthia strategy over the next 5 years will focus on improving the efficiency of our existing businesses and pursuing new scalable opportunities in our region.
We are assured that with the exceptional capabilities amongst the management team of the company, Agthia will create greater opportunities for its people, and set new benchmarks in the F&B industry.”
Alan Smith, Chief Executive Officer, Agthia Group, said: “Our strategy stems from an in-depth assessment of the business and a clear vision of where we want to go. We will continue to get leaner, protect our core businesses and ensure that our progress is agile and deliberately paced. The effective integration of new businesses and the decisions we make in the near-term will also benefit us in the long-term.
We will follow a disciplined expansion plan focused on the acquisition, integration and scaling of new businesses and create a more effective way to serve and innovate, as we continue to engage with our partners and key customers to leverage their insights in building a stronger portfolio.”
Strategic growth initiatives
As one of the three pillars outlined in its strategy, Agthia will deliver on growth by upscaling in priority markets, expanding into value-add categories and driving margins improvement by 2025. This will be made possible by strengthening the core base, including strengthening the water category, protecting flour and feed categories as well as shifting the portfolio mix towards higher margin categories.
In addition, Agthia has embarked upon a robust inorganic growth strategy that is focused on the acquisition of companies with strong consumer brands that are market leaders in their respective categories.
“Over time, the strategy will generate cost and revenue synergies as we integrate these businesses, through cross-selling opportunities and enhancing the Group’s regional brand portfolio.” explained Smith.
Improving efficiency across the board
Going forward, the organisation is targeting a savings of AED200 million through synergy extraction as well as simplification of its existing and acquired businesses. Along with strategic partnerships for distribution and marketing, the organisation will enhance commercial and working capital excellence, operational optimisation, lean procurement and manufacturing and supply chain management. Furthermore, non-scalable assets will be divested while suppliers and specifications will be streamlined.
Enhancing organisational capabilities
Agthia will continue to develop its human capital and acquire additional talent with a clear attention to category management expertise, in the hope of aligning its capabilities with the expected demands of a growing organisation.
Smith added, “Our key focus for the next five years includes digitalising performance management systems and implementing change initiatives across the board with a continued emphasis on sustainability and innovation.”
Agthia’s reinvigorated strategy is underpinned by a relentless ambition to become an F&B leader in the MENAP region and beyond by 2025. The Group will continue to drive efficiencies in its operations, optimise product portfolio, maintain a principled allocation framework and adopting a best-in-class Environment, Social & Governance (ESG) agenda to enhance consumer experience and deliver shareholder returns in line with global standards.
Agthia Group is a leading Abu Dhabi based food and beverage company. Established in 2004, the Company is listed on the Abu Dhabi Securities Exchange (ADX) and has the symbol “AGTHIA”. Through Senaat, Agthia Group PJSC is part of ADQ, one of the region’s largest holding companies with a broad portfolio of major enterprises spanning key sectors of Abu Dhabi’s diversified economy.
The Company’s assets are located in the UAE, Saudi Arabia, Kuwait, Oman, Egypt and Turkey. Agthia offers a world class portfolio of integrated businesses providing high quality and trusted food and beverage products for customers and consumers across the UAE, GCC, Turkey and the wider Middle East. More than 4,000 employees are engaged in manufacturing, distribution and marketing various food and beverage products: Water (Al Ains, Al Bayan, Alpin Natural Spring Water, Bambini); Food (Al Foah); Flour (Grand Mills); Animal Feed (Agrivita); Juice (Al Ain Fresh); Dairy (Yoplait); Processed Food (Al Ain Tomato Paste, Frozen Vegetable); Ambient and Frozen Bakery (Grand Mills, Al Faysal Bakery and Sweets). For more information: www.agthia.com | [email protected] | Tel: 971 2 506 0600.