Oman Flour Mills (OFM), the largest integrated food company in the Sultanate of Oman, has announced its plans to expand its portfolio and strengthen its presence in the wider Gulf region. As part of its growth strategy, OFM is actively seeking opportunities to acquire various food-related companies and assets.
According to OFM Chairman Ahmed Ali al Bulushi, the company is currently finalizing its strategic roadmap to enter new segments within the food industry. This expansion plan reflects OFM's commitment to diversify its operations and capitalize on growth opportunities.
One of the targets for acquisition is an undisclosed company involved in the sweets and confectionery business. Atyab Investments, the investment arm of Oman Flour Mills, has initiated the acquisition bid for the assets of this company. Al Bulushi also mentioned that a technical consultant has been appointed to assess and evaluate a company operating in the animal feed sector, which is another potential acquisition target.
Furthermore, Atyab Food Industries (AFI), a wholly-owned subsidiary of OFM, is actively pursuing the acquisition of a prominent bakery in Oman. AFI has appointed a consultant who is currently in the final stages of conducting Customer Due Diligence (CDD) and the Valuation process for this bakery.
These strategic moves highlight OFM's determination to expand its reach and diversify its offerings within the food industry. By acquiring new companies and assets, OFM aims to strengthen its position in the market and capitalize on emerging opportunities in the Gulf region.
Oman Flour Mills, a publicly-traded company, operates as a subsidiary of Oman Food Investment Holding Company (Nitaj), which is the food sector investment arm of Oman Investment Authority (OIA). The Group manages a diverse portfolio of approximately 14 subsidiary and associate companies involved in various sectors such as grain imports, milling and storage, industrial bakery operations, animal feed production, foodstuff, dairy and poultry products, and lab testing services.
In 2023, the aggregate group revenue witnessed a 6% increase, reaching RO 123.94 million. This growth was primarily driven by the higher revenue generated by the flagship company, Oman Flour Mills.
The Chairman stated that despite a slight 3% rise in the cost of sales, the gross profit experienced a significant surge of 32%, amounting to RO 18.12 million compared to RO 14.25 million in 2022. The implementation of operational efficiency measures played a crucial role in boosting the operating profit, which saw a substantial uplift of RO 3.96 million. However, the net profit after tax declined by 25% to RO 1.30 million, compared to the previous year's figure of RO 1.74 million.
The Group is also actively pursuing other initiatives to drive growth and diversify its product offerings. Atyab Investments is leading the efforts to establish a bakery in Saudi Arabia, and discussions are underway with potential partners to finalize a detailed feasibility study for this initiative.
Additionally, plans for the establishment of an industrial food cluster in Oman are progressing well. This cluster aims to accommodate various small-scale manufacturing units that will cater to the food-related needs of the country. The Chairman mentioned that a final report on the detailed market feasibility, shortlisted opportunities, and financial model is expected to be completed by March 2024.
