Mezzan Holding, one of the largest manufacturers and distributors of food, beverage, FMCG and pharmaceutical products in the Gulf, has released the company’s 2016 full-year financial results.
The Kuwait-based Mezzan Holding’s full year revenue was KWD 207.4 million (USD 678.9 million), representing a 5.8% increase on the same period in 2015. The company’s net profit for the year was KWD 17.2 million (USD 56.4 million) in line with expectations.
2016 Financial Results Highlights
Revenue: KWD 207.4 million, up 5.8%
Underlying Net Profit: KWD 17.2 million
Reported Net Profit attributable to Equity holders of the Parent Company: KWD 17.2 million, down 11.6% (reflecting a one-off non-recurring gain of KWD 2.2 million from net insurance proceeds recorded in Q2 2015 )
Underlying Net Profit : KWD 17.2 million (flat to last year when excluding a non-recurring gain of KWD 2.2 million from net insurance proceeds recorded in Q2 2015)
2016 Balance Sheet Highlights
Total Assets: KWD 211.7 million, up increase 17.4%
Equity to Parent Company: KWD 106.4 million, up 9.1%
Mezzan Holding (profile) Executive Vice Chairman Mohammad Jassim Al Wazzan (biography) said, “We are pleased to report that the company has recorded record revenues in 2016 and a strong fourth quarter despite the predominant macro-environment challenges in our markets. In 2016, the company had top-line growth in five of the seven markets we operate, including Kuwait, Qatar, Jordan, and Saudi Arabia, our newest market.”
In the third quarter, the company entered the largest consumer market in the Gulf with acquisition of Saudi-based Al Safi Foods. The acquired company is currently undergoing a turn-around involving various business optimization initiatives and the introduction of new SKUs into the Saudi market.
Mezzan Holding CEO Garry Walsh (biography) said, “Our diversified business once again proved its resilience and defensive nature in the face of economic challenges. The year was challenging for the consumer sector as a whole. However Mezzan’s business mix, diverse products portfolio, geographic spread and strong balance sheet successfully shield the company from adverse market conditions challenges. We are pleased with our results and we believe that Mezzan is well positioned for continued positive performance in 2017 and beyond.”
Mezzan Holding performance by business line
Mezzan Holding incorporates 30 subsidiaries and is operationally structured into two primary business lines: the Food Business Line and the Non-Food Business Line.
Food Business Line: Up by 7.9%, the Food Business Line generated KWD 155.3 million in revenue, or 74.9% of group revenue. The business line comprises three divisions, and they are Manufacturing and Distribution (52.6% of group revenue), which grew by 8.4%, Catering (12.9%), which saw a slight drop in revenues of 1.3%, and Food Services (9.4%), which was up by 20.9%.
Non-Food Business Line: Slightly down by 0.3%, the Non-Food Business Line generated KWD 52.0 million during the period, or 25.1% of group revenue. This Business Line comprises two business divisions, and they are FMCG and Pharmaceuticals (22.3% of group revenue), which grew by 1.3%, and Industrials (2.7% of group revenue), which declined by 11.8% in the period.
Regional Business Highlights: Mezzan Holding operates in seven countries, with over 90% of revenue generated in three markets — Kuwait (64.9%), UAE (16.8%) and Qatar (9.5%). In Kuwait, revenues grew by 4.3%, in UAE revenues were slightly down by 0.9%, and in Qatar revenues grew by 9.8%. The group also saw revenue growth of 42.2% in Jordan, contributing 5.0% to the group’s total revenue for the period.