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Cairo Poultry’s net profit soars by 333% YoY

The secret’s in the feed

Cairo Poultry (CP) has released its consolidated financial statements for 2023.

The breakdown:

Revenues

CP’s revenues reached EGP 11.8 billion compared to EGP 6.47 billion last year, an 82.3% YoY increase.

Gross Profit

After subtracting the cost of goods sold, gross profit was left at EGP 2.8 billion compared to EGP 827 million last year, a 238% increase YoY.

Gross Profit Margin:
- As revenues grew significantly more than the cost of goods sold, gross margins grew to 23.7% from the previous year’s 12.7%.

Operating profit

The company’s profit after deducting marketing, operational, general and administrative expenses stood at EGP 2.27 billion, a 295% YoY increase from last year’s EGP 574 million.

Operating Profit Margin:
- This means an operational profit margin improvement to 19.2% from last year’s 10.4%.

Net Profit

Net profit jumped to EGP 1.16 billion from EGP 268 million last year, a 333% YoY increase.

Net Profit Margin:
- This was reflected in net profit margins increasing to 9.8% from 6% last year.

Behind the Leap:

The company, vertically integrated, sells products at almost every step of the supply chain, including feed, chicks, live chicken, eggs, chicken meat, and retail products such as their flagship Koki brand.

Claps Class – Vertical Integration:

It’s when a company controls different steps of the supply chain, such as controlling raw materials, product components, product manufacturing, and retail sales.

The Golden Egg:

According to Shams Abbas, Equity Strategist at Thndr Securities Brokerage, 2023’s animal feed shortage had a large effect on the company’s operations. CP was able to leverage its production of feed to sustain its sales.