Juhayna Food Industries (JUFO) Q1 2023 earnings summary

Executive summary

• Q1 2023 net sales rose 42% YoY to EGP 3.423bn; net profit after tax increased 135% to EGP 339.4m, with a 9.9% margin.

• Operating profit reached EGP 498.7m versus EGP 200.4m; EBITDA climbed 113% to EGP 594m as gross margin improved and SG&A fell as a share of sales.

Financial highlights

• Gross profit rose 59% to EGP 1.017bn; gross margin reached 29.7%, up 3 pps YoY.

• Cost of sales increased 37% to EGP 2.406bn; net finance expense rose to EGP 74.8m from EGP 13.0m.

• Parent-attributable profit was EGP 339.2m versus EGP 144.4m; EPS was EGP 0.36 versus EGP 0.15.

• Selling and marketing expenses increased to EGP 434.2m from EGP 375.7m; general and administrative expenses rose to EGP 91.6m from EGP 74.4m.

Outlook and guidance

• Planned FY23 CAPEX was EGP 450m; Q1 spending of EGP 93m focused mainly on manufacturing and distribution.

• Export expansion remained a focus; exports reached EGP 286m, driven mainly by concentrates.

• The positive margin effect from lower-priced raw materials purchased at a lower exchange rate was expected to diminish as the year progressed.