Domty reports 15% profit growth for first nine months of 2024

EGYPT – Arabian Food Industries Company, known for its flagship brand Domty, reported a 15.04% increase in net profits for the first nine months of 2024, despite challenges in its core operations.

The Egyptian dairy producer recorded net profits of EGP 407.6 million (US$8.23 million) during this period, up from EGP 354.3 million (US$7.15 million) in the corresponding period of 2023.

The company’s financial statement, filed with the Egyptian Exchange on November 18, highlighted strong consolidated sales growth, rising to EGP 6.89 billion (US$140 million) from EGP 5.18 billion (US$100 million) a year earlier.

However, Domty’s net after-tax profit for its main operations fell slightly to EGP 405.7 million (US$8.18 million), compared to EGP 411.0 million (US$8.3 million) last year.

This performance comes as Domty prepares for a potential change in ownership. Arla Foods, a European dairy giant, initiated a bid in October 2024 to acquire 100% of Domty’s shares.

The offer values Domty at EGP 8.9 billion (US$183 million), with an offer price of EGP 31.48 (US$0.64) per share. If approved, the deal would see Domty delisted from the Egyptian Exchange and become a privately held company.

The acquisition aims to strengthen Arla’s presence in North Africa, a crucial region for its international expansion strategy.

Arla’s investment comes as it seeks to offset losses in West Africa, where revenue fell by 18.8% to US$138.3 million in 2023 due to the devaluation of the Nigerian Naira.

In contrast, the Middle East and North Africa accounted for US$1.09 billion in Arla’s revenue last year, underscoring the region’s importance.

Domty’s existing leadership, including CEO Mohamed El Damaty, will remain in place post-acquisition, ensuring continuity in operations. The El Damaty family, the company’s primary shareholders, will retain a stake in partnership with Arla.

Founded in 1990, Domty has established itself as a major player in Egypt’s dairy sector, offering nearly 200 products and employing 2,600 workers.

The company’s resilience and adaptability have been evident in its financial trajectory. In 2023, Domty’s consolidated net profits surged to EGP 454.43 million (US$9.18 million), up from EGP 265.7 million (US$5.37 million) in 2022.

Net sales rose to EGP 7.5 billion (US$151 million) in 2023, compared to EGP 5.08 billion (US$102 million) the previous year.