NADEC’s strong Q1 2023 performance driven by Ramadan: CEO

Logo of National Agricultural Development Co. (NADEC)

National Agricultural Development Co. (NADEC) reported strong performance in Q1 2023, as nine days of Ramadan coincided with the end of the first quarter, CEO Solaiman Altwaijri told Al Arabiya TV channel.

The company also delivered a robust monthly performance, he added.

Improved operating efficiency and product quality, in line with the company’s resilience in dealing with higher inputs contributed to achieving a good performance in terms of volumes and prices, Altwaijri noted, expecting this trend to sustain over the coming period.

Higher cost of finance weighs on all companies, Altwaijri said, adding that NADEC’s loan portfolio comprises short- to medium-term facilities at variable rates, as the fixed rate ones represent a risk to banks and borrowers.   

NADEC is exploring ways to reasonably cut the cost of finance (COF), as it lowered the commercial loans in favor of lower-COF government loans. Additionally, any excess cash will be directed to pay off higher-interest credit facilities.  

This will unlikely impact the company’s dividend payment, since the board has not yet approved the dividend distribution plans for 2023-2024.  

If NADEC attains a strong financial position, dividends will be reconsidered and shareholders will be compensated for the previous losses, the CEO said.   

The Tadawul-listed dairy product and juice maker reported an over twofold increase in Q1 2023 net profit to SAR 37.7 million, from SAR 15.1 million in the prior-year period, according to data available with Argaam.