Egypt's Cheese-Maker Domty Sees Revenues Jump in Third QuarterBy
Consumers adapting to price hikes following currency float
Demand still ‘not what it used to be,’ Vice-Chairman says
Egyptian cheese-maker Arabian Food Industries is expecting third-quarter revenues to jump by about 50 percent and sales volumes to be better than the first two quarters of the year as Egyptian consumers adapt to price hikes that followed last year’s currency float.
The Cairo-based company, also known as Domty, sees revenues of 700 million Egyptian pounds ($39.7 million) this quarter and while sales volumes will fall as much as four percent compared to last year, this is "much better" than earlier in 2017, Vice Chairman Mohammed El Damaty said in an interview at his Cairo office.
"Things are moving to the better relatively but still demand isn’t like it used to be and we aren’t expecting it to return to its normal levels rapidly," El Damaty said. "We are in a ‘wait and see’ period, we overcame the crisis of the past few quarters and moved away from losses and now we are standing on a solid ground."
The company plans to begin product promotion and distribution activities in Rwanda within weeks and plans to boost exports to 20 percent of output in 2018 compared to 8 percent currently.
Egyptian producers of consumer goods, who import most of their raw materials, have taken a sales hit since the country floated its currency last November. The move forced them to raise their prices and inflation leaped to near-record levels. A recovery in demand and profitability would help them resume expansions and cancel cost-cutting plans.
"The economy will begin picking up through local investors but they aren’t being put in consideration now and as long as foreign investors are seeing locals halting their investments, they will think one thousand times before investing," he said.