Halwani Bros Company expects its growth this year to rise by 30% to EGP 2bn from EGP 1.4bn last year, thanks to the rise in the prices of some of its products following the decision to float the pound.
Fathi Mohamed, financial director of Halwani Bros, said that part of the increase in revenues this year comes through the rise in the prices of many products, with the steady sales in terms of quantity.
He pointed out that the company is considering the transfer of factories of dry products in one area; therefore, they are looking for a piece of land with an area of 50,000 square metres to transfer four factories in one area to produce products such as Maamoul, Jam, Halawa, and Tahina in one large factory.
He added that the company has set at the beginning of the current year EGP 100m for the transfer, but economic decisions and high costs is making the company postpone the project until the acquisition of land and the stability of costs.
He explained that Halwani Bros is currently re-evaluating of the project, but has not yet determined the value of investments necessary for implementation, and it is scheduled to buy the land early next year, with the full transfer in 2019.
The company’s chief financial officer estimated that exports accounted for only 15% of total annual sales. The countries of the Middle East, especially Libya and Yemen, account for 70% of the total, and China is in the forefront of the markets outside the region, as well as Germany and America.
The company aims to invade the Kuwait and UAE markets with poultry products and dry products, and it aims to expand in Saudi Arabia by offering new products in the coming period.
He added that the company focuses on the export of dry products, because the value added to them is higher than others, and that it is participating in the current Anuga exhibition to identify the latest technology and get to know new global customers.
He pointed out that the markets of African countries represent a “white area” for the company, and the company has already begun to study some African markets, in preparation for entry during the coming period.
Mohamed pointed out that these markets need to send samples and invite importers there to visit factories to identify products and follow the stages of manufacturing, and this needs time.
He explained that the increase in exports of some sectors during the current year is an increase in value resulting from the change in the exchange rate of the local currency, not an increase in the quantities and capacities of companies.
He pointed out that the export sector has become a key factor to reducing the gap between the resources the dollar company used to import raw materials, amounting to 80% of their annual needs, and absorbing the impact of inflation in the value of the local currency.
Mohamed explained that Halwani Bros is seeking to reduce the volume of its imports of raw materials as much as possible in the current period, and to switch to the local alternative, but this is not very available, especially since the company’s basic products are based on imported meat and sesame.
On the level of trade agreements between Egypt and other countries, Mohamed said that it is good and is working to increase trade exchange with the member countries of the agreements, thus providing greater export opportunities for Egypt in the coming period.
He explained that the company will hold a meeting at the level of export officials to clarify the position of the Mercosur agreement with Argentina, Brazil, and Uruguay, and identify opportunities that can be exploited.