Almarai Company (2280) CMD 2026 summary

Strategic direction

• Shift from the 2022-2026 capacity-building phase, including an SAR 18bn investment program, to utilization, execution, productivity and value realization in 2026-2031.

• Four growth pillars: accelerate core businesses, selectively expand categories, grow Foodservice and e-commerce, and strengthen priority markets.

• Core businesses remain the primary growth engine; most planned growth is expected from existing businesses, with selective expansion complementing the core.

• Saudi food and beverage market is estimated at SAR 220bn; current participation covers ~30%, with ~25% average share in those categories. Seafood and red meat could expand the addressable share to ~55%.

Growth plans and development

• Target 2031 revenue of SAR 36bn or more versus an estimated SAR 24bn in 2026: 1.5x growth, 8% CAGR and SAR 12bn incremental revenue.

• Revenue contribution targets: SAR 4bn from core categories, SAR 6bn from capacity-led businesses and SAR 2bn from adjacencies; respective growth rates are ~5%, ~10% and ~20% CAGR.

• Core growth target is ~5% CAGR; poultry, bakery, Foodservice, frozen bakery, and growth in Egypt and Jordan are capacity-led drivers. The plan assumes no price increases.

• Selective pipeline includes bottled water, frozen bakery, ice cream, seafood and red meat, leveraging sourcing, processing, cold-chain and distribution capabilities.

• Poultry supply is expected to reach 20%-25% of the Saudi market by end-2027; red meat, seafood, water and ice cream are expected to be front-loaded over the next 2-3 years.

Financial framework and returns

• Target 2031 earnings at 1.6x the 2026 base and ~10% CAGR, at least 2 percentage points ahead of revenue growth; guidance assumes no price increases.

• Profit drivers include richer product, country and channel mix; factory utilization from current 60%-70% levels; productivity, digitization, automation, procurement efficiency and economies of scale.

• Cumulative operating cash flow target is ~SAR 31bn for 2027-2031, with annual operating cash flow above SAR 7bn and free cash flow of ~SAR 4bn by 2031; free cash flow is expected to turn positive from 2026F.

• Operating cash flow is expected to rise SAR 300m-SAR 400m annually as CapEx declines by SAR 300m-SAR 400m annually and stabilizes at SAR 2.6bn-SAR 2.7bn.

• Target asset utilization to deliver RONOA above 12%, at least 3%-4% above WACC; seafood and beef each include SAR 500m CapEx and hurdle rates at least 200-300 bps above the standard threshold.