Tanmiah's MD says Russia-Ukraine war upped costs; product prices raised to reduce impact

Logo of Tanmiah Food

Ahmed Osilan, Managing Director of Tanmiah Food Co., said that raw material prices began to rise in the second half of 2021, but the Russia-Ukraine war has worsened the problem.

Both countries are among the largest exporters of poultry production raw materials, such as corn and soy, which in turn raised the cost of sales and general expenses, Osilan told Al Arabiya TV.

"Higher prices are expected to continue in the coming period. However, Tanmiah has taken various measures to address the problem, such as a gradual increase in prices and storage capacity from three to six months,” Osilan explained.

“In addition, the company shifted to saving money with regard to chicken feed mix. This will mitigate the impact of the price hike and gradually push net profit normalize," Osilan added.

Tanmiah reported revenue of -23% in Q4 2021. In the current quarter, revenue rose to 2%, and are now on track for correction.

The increase in the company’s product prices will be reflected in the coming periods. Net profit will be reconsidered in terms of growth, after the results of corrections, said Osilan.

Tanmiah earlier posted SAR 1.5 million in net profit for Q1 2022, a drop of 92% compared to SAR 18.8 million during the same period in 2021.