FrieslandCampina Engro Pakistan Limited (FCEPL) announced its financial results for the year ended December 31, 2023. The Company continued its growth trajectory and delivered another record year with the highest-ever top line and operating profit. This was in the face of a challenging macroeconomic environment and intense competition. The Company achieved a remarkable milestone, surpassing the PKR 100 billion topline mark with a 36% increase over last year.

The Company witnessed a gross profit growth of 18% while gross margin declined by 218 bps due to high inflation, global supply chain disruption, foreign exchange constraints and currency devaluation. However, the operating margin declined by 115 bps over last year due to cost rationalisation and efficiency-building initiatives. Profit after tax declined from PKR. 2.5 billion to PKR 1.5 billion in the same period the previous year due to a significant increase in finance costs, with interest rates almost doubling over the year. Brand health indicators had a positive trajectory, setting the stage for long-term sustainable growth.

Dairy & Dairy-based Products Segment

The segment reported a revenue of PKR 91.68 billion, reflecting a growth of 38.3% compared to the previous year. Olper’s led this growth by strengthening its market leadership position through brand and trade investments. Olper’s UHT Milk, Olper’s Cream, Flavored Milk and Tarang experienced double-digit revenue growth.

Olper’s UHT maintained its presence on air with its ‘Happy Mornings’ campaign across key touchpoints, including TV, digital, social media, and in-store. In the last quarter, the brand launched the 1½ Pao Economy Pack, supported by an integrated marketing campaign across all relevant consumer touchpoints. It was established as the ideal serving size for a single breakfast consumption occasion.

Olper’s flavoured milk continued to drive presence on TV through its ‘No Break in Performance’ campaign, encouraging milk consumption in children. It also launched Olper’s All Stars, an animated film driving engagement with children through a relatable and engaging medium.

Frozen Desserts Segment

The segment reported a revenue of PKR 8.56 billion, demonstrating a growth of 19.2% compared to the previous year. The brand strategically invested in season-opening activities and capitalised on various festivities. Additionally, the business maintained consumer excitement by introducing three innovations during the year.

Financial Performance

The financial performance of the company for the year ended December 31, 2023, is summarised below:

Future Outlook

The Company expects to face headwinds on both demand and supply sides due to inflationary pressures, declining consumer purchasing power and global supply chain disruptions. However, equipped with an agile business model, the management is confident in its ability to drive efficiencies across the value chain, build resilience, and future-proof the business to deliver growth by staying relevant to consumers.

Dedicated to Nourishing Pakistan and improving farmers’ livelihoods, the Company will continue to advance its exemplary Dairy Development Program, designed to ensure inclusive growth and increased profitability for dairy farmers, including women farmers.

Continued investments in brand equity, conversion to packaged milk, and product portfolio expansion will remain priorities. With this strategy and distinctive positioning combined with enterprising talent and emerging methodologies, the Company is poised for the next chapter in Pakistan’s food safety and nourishment narrative. Leveraging its global expertise and 150 years of heritage, FrieslandCampina Engro Pakistan Limited remains committed to the highest standards of hygiene, food safety and sustainability. It will continue to provide safe, affordable, and nourishing dairy and dairy-based products to millions of Pakistanis daily.