Domty profits shrink due to the Egyptian pound devaluation

Domty, an Egyptian cheese maker, has reported a 3.8 percent decrease in net profits quarter-on-quarter due to the currency devaluation and rising global inflation.

50.5 million pounds ($2.7 million) is the net profit for the first three months of the year, which is considered down from 52.5 million in the fourth quarter of 2021, but an improvement from the previous year’s loss of 3.4 million pounds.

The company said in a statement on the London Stock Exchange (LSEG), “The (Q1 2022) bottom line was hit by forex losses of about EGP12 million resulting from the devaluation of the Egyptian pound that occurred by the end of March,”

The Egypt-headquartered company manufactures a range of branded white and processed cheese and juice products explaining, “Our raw material costs are (also) suffering from the global inflation… We are doing the best we can to pass on price increases to the end consumers gradually in order not to affect the demand negatively,”

Domty noted that its revenues rose 73 percent year-on-year, driven by higher sales in dairy, bakery, and juice segments despite pressures from currency devaluation and global inflation.

Sandwich and white cheese sales volumes jumped by 53.2 percent and 42 percent, respectively, while juice and mozzarella sales increased by 26.5 percent and 11 percent.

The company indicated that its profits have been maintained above 50 million pounds for the third quarter in a row and that it is “pleased” with the results.