Karachi, FrieslandCampina Engro Pakistan Limited (FCEPL) announced its financial results for the first quarter of 2024, showing a 21% increase in topline revenue. The company's revenue for the quarter reached PKR 27.5 billion, compared to PKR 22.7 billion in the same period last year. This growth occurred despite challenging operating conditions and a general economic slowdown, indicating that the company's volume growth and consumer-oriented offerings played a crucial role in driving success.
According to FrieslandCampina Engro Pakistan Limited, the gross profit grew by 1%, while gross margins declined by 320 basis points due to currency devaluation and inflationary pressures on commodities and energy prices. The company's profit after tax (as a percentage of sales) decreased by 200 basis points to PKR 0.67 billion, compared to PKR 0.99 billion in the same period last year, due to rising interest rates.
The company's Dairy-Based Products Segment reported revenue of PKR 26.1 billion, representing a 15% growth compared to the same period last year. This growth was largely attributed to the company's flagship brand Olper's, which expanded its reach through consistent brand-building and trade activities. The Olper's 1½ Pao Bachat Pack Campaign was promoted through television and digital channels, targeting families with a milk pack ideal for single-breakfast occasions. Other value-added brands like Olper's Cream, Olper's Cheese, Dobala, and Tarka also gained volume despite competition from established players.
The Frozen Desserts Segment, however, experienced a decline in revenue, with PKR 1.36 billion compared to PKR 1.44 billion in the previous year. The company attributed this drop to delayed summer weather and unexpected rainy conditions across the country, which affected expected growth. Nonetheless, FCEPL anticipates a quick recovery in the second quarter as the summer season gets underway.
Despite these fluctuations, FCEPL remains committed to delivering strong business results to shareholders while addressing challenges like inflation, currency devaluation, and high interest rates. The company's agile business model allows it to maintain growth through operational efficiency and by adapting to changing consumer demands. Looking ahead, the company plans to continue investing in brand value and broadening its product portfolio to improve profit margins.
FCEPL also emphasizes its commitment to maintaining high standards of hygiene, food safety, and sustainability, leveraging its 150-year heritage and global expertise to provide safe, affordable, and nourishing dairy products to millions of Pakistanis every day.