FrieslandCampina Engro Pakistan Limited announces Financial Results for FY 2021
FrieslandCampina Engro Pakistan Limited (FCEPL) announced its financial results for the year ended December 31, 2021. The Company reported revenue of PKR 52 billion, registering 18% growth versus last year. FCEPL recorded highest-ever volumes of Ice Cream and highest-ever revenue in Dairy and Ice Cream segments in 2021. This milestone was achieved by focusing on overall volume growth through expansion of distribution, greater brand penetration, mix improvement through value accretive brands and improving efficiencies across the value chain. These initiatives reflect FCEPL’s unwavering commitment towards enhancing access to nutrition for a healthier and food-secure Pakistan.
Despite record inflation and rupee devaluation which led to a steep increase in commodity prices, the Company managed to offset the spikes and improve Gross Margin by 350bps versus last year, through several innovations and savings initiatives in the value chain. As a result, profit after tax improved by 10X compared to last year – PKR 1,804 million in 2021 vs PKR 177 million in 2020.
On September 8th, 2021, FrieslandCampina, celebrated its milestone 150-year anniversary of delivering superlative dairy products and nutritional excellence. In line with its commitment to the Nation, FCEPL partnered with the University of Education to launch a 6-month pilot School Milk Program with the aim to improve the nutritional status of thousands of children and enable them to take full advantage of the education provided to them.
Dairy and Beverages
The segment reported revenue of Rs. 46.9 billion, growing 16% compared to the same period last year. Olper’s led the growth in the segment while strengthening its position as the market leader through brand and trade investments, and expansion of retail footprint by 6,000+ outlets. Olper’s UHT Milk, Cream, Flavoured Milk and Tarrka Ghee also recorded double-digit growth.
With a focus on improving accessibility and affordability, the Company launched the Olper’s Pouch at a price point of PKR 50 in Pakistan. Other recent launches include Olper’s Flavored Milk, Olper’s Full Cream Milk Powder (FCMP), Olper’s Cream, Olper’s Pro-Cal, Tarang Tea Whitening Powder (TWP) and Tarang Elachi, all of which gained a healthy market share in a short timespan despite strong competition. The Company will continue to leverage FrieslandCampina’s global expertise, introduce new products and explore new channels to serve its customers effectively and efficiently. Ice Cream and Frozen Desserts
The segment reported a revenue of Rs. 5.22 billion, reflecting a growth of 42% versus last year. By investing in seasonal activities and festivities, introducing new products, consumer-focused campaigns and employing e-commerce channels to enhance product availability, the Company achieved its highest-ever volumes in the second half of the year.
The financial performance of the company for the year ended December 31, 2021, is summarized below:
| Full year ended|
Dec 31, 2021
|(Rs. in million)||2021||2020|
|% of sales||6.6%||3.4%||320 bps|
|Profit / (Loss) after tax||1,804||177|
|% of sales||3.5%||0.4%||310 bps|
|Earnings / (Loss) per share (Rs.)||2.35||0.23|
The business environment remains challenging amidst the resurgence of COVID–19 cases. Supply chain disruptions and dynamic consumer needs may affect the business’s ability to serve consumers effectively. However, the Company will continue to remain agile and drive efficiencies across the value chain to deliver growth. The business will also continue to invest in brand equity and expand its profit accretive portfolio to leverage margins.
At FCEPL, our purpose is to transform the health and well-being of Pakistanis now and for generations to come. Thus, the Company will expand upon its partnership with the Pakistan Dairy Association (PDA) and the Government to educate the consumers on the potentially hazardous effects of loose milk, and positive features of safe, packaged milk.
As dairy farmers are the backbone of the Company, FCEPL’s Dairy Development Program will ensure inclusive growth and increased profitability for the farmers. The business will continue to train the farmers with best practices for improved productivity, yield and profits, thereby developing and uplifting the communities we operate in.
FCEPL remains committed to the highest standards of hygiene, food safety and sustainability, and will continue to leverage its global expertise and experience of 150+ years to provide safe, affordable, and nourishing dairy products to millions of Pakistanis, every day.