Unity Foods Faces Decline in Revenue and Profit Amid Strategic Diversification Efforts

Karachi: Unity Foods Ltd. conducted its FY24 analyst briefing, unveiling key financial results and future strategies. The company reported a 17.6% decline in revenue to PkR83.0 billion, attributed to falling local edible oil prices. Unity Foods also faced a PkR3.4 billion loss, contrasting with a PkR675 million profit last year, due to high finance costs. Concurrently, the company expanded its production capacity and diversified its product range, aiming to reduce dependency on industrial bulk edible oil.

According to AKD Securities Limited, Unity Foods’ gross margins fell to 8.73% this year from 13.69% in FY23, influenced by negative price parity between local and international markets. The company increased its edible oil refining capacity at the Mayande Refinery and introduced new flour and rice mills, as well as a confectionery plant. This strategic shift is reflected in the decreasing contribution of industrial bulk edible oil to total sales, now at 39% compared to 48% last year, while Sunridge’s contribution rose to 27% from 11%.

Unity Foods also reported a significant boost in exports, reaching PkR7.86 billion from PkR0.86 billion in the previous year, as it expanded to eight export destinations. The management plans to further grow its Sunridge brand in the Punjab region. Meanwhile, the company anticipates potential challenges in rice exports due to India’s lifted export ban and expects stable or decreasing palm oil prices, which have not aligned with petroleum trends due to weather conditions.

The post Unity Foods Faces Decline in Revenue and Profit Amid Strategic Diversification Efforts appeared first on Pakistan Business News.