Agthia Group Reports Revenue Growth Amidst Economic Challenges

Agthia Group's Financial Performance in Q3 2026

Agthia Group PJSC (AGTHIA:UH), a leading food and beverage company in the region, has made headlines by reporting significant revenue growth in the third quarter of 2026. Despite facing challenging economic conditions, the company successfully navigated through the storm and achieved substantial financial milestones.

Robust Revenue Growth

In the third quarter of 2026, Agthia's revenue rose by an impressive 14.4% year-over-year, reaching a total of 1.3 billion AED. This figure includes one-time sales of 104.7 million AED. When examining the underlying performance, Agthia achieved a solid growth rate of 5.2%. The overall revenue growth was supported by improved operational execution that greatly enhanced profitability.

Operating income (EBITDA) demonstrated remarkable growth, surging by 39% to reach 123.1 million AED, while the net profit ballooned to 33.2 million AED from last year's 4.1 million AED, which had previously been affected by impairment charges in the Snacking division.

Year-to-Date Performance

Throughout the first nine months of 2026, Agthia also reported a commendable revenue increase of 9.6%, totaling 3.9 billion AED. The climb in EBITDA was even more striking, soaring by 36.7% to hit 433.6 million AED, demonstrating a solid position in the market. Notably, net profit almost tripled to reach 154.6 million AED, evidencing the company's significant strides in boosting its financial health.

Strong Financial Standing

Agthia's financial position remains robust, as evidenced by a free cash flow of 212.1 million AED during the nine-month period, marking a turnaround from capital outflows recorded in the same period the previous year. The net debt to EBITDA ratio improved from 2.9x in December 2025 to 2.4x, while cash reserves stood at 536.2 million AED, providing a strong foundation to weather future challenges.

Segment Performance Highlights

The water and food sectors exhibited impressive revenue growth, with an astonishing increase of 36.7%, significantly bolstered by one-time sales linked to food security initiatives. Core business operations also performed admirably, reflecting an 8% increase in revenue for home and office products, aided by growth in Turkey and Kuwait. However, rising costs for PET, freight, and distribution put pressure on segment margins.

In the agri-food category, revenue grew by 10.5%, primarily due to an 18.3% increase in animal feed sales. However, the EBITDA for this segment fell by 39.3% to 31.4 million AED, affected by input cost pressures and higher distribution costs.

The Snacking division continued to improve profitability as its reset strategy progressed, illustrated by a gross margin increase of 613 basis points, with gains across all business areas during Q3. Abu Auf announced a 21.7% sales increase and the addition of 69 new stores this year, expanding its market share in ground coffee.

The Proteins and Frozen Products segment achieved a revenue increase of 25.1% in Q3 2026, with Nabil leading the growth at 25.3%. Additionally, the expansion of Agthia's facilities in Saudi Arabia practically quadrupled protein sales in the region.

Leadership Insights

Khalifa Sultan Al Suwaidi, Chairman of Agthia Group, remarked on the recent months, which have tested supply chains across the region and highlighted the importance of resilient food companies. He praised Agthia for rising to the challenges posed by the market environment and acknowledged the Board's satisfaction with management's progress in transforming the company.

Salmeen Alameri, the CEO of Agthia Group, underscored that their ongoing transformation is bearing fruit. Over the past year, they have strengthened their portfolio and instituted greater operational discipline. Alameri also noted decisive actions taken to safeguard the business amidst intensified input and logistics pressures while acknowledging the impact of these challenges on performance. The company is developing innovation, data, and digital capabilities to stay competitive and navigate the current volatile landscape effectively.

With a solid operational foundation, Agthia is well-equipped to contend with the complexities of today’s market environment.