Tanmiah Food Company has reported an 8.0% year-on-year revenue growth for the first quarter of 2026, achieving SAR 731.2 million. This growth is particularly significant amid ongoing market challenges, including geopolitical tensions and seasonal fluctuations. The increase was largely driven by a 5.6% rise in the Agribusiness sector and an impressive 42.2% growth in Restaurant Operations.
Performance Overview
The Fresh Poultry segment of Tanmiah saw total sales volume rise to 43.2 million birds, reflecting an 8.6% year-on-year increase. Average daily production reached 604,000 birds during this period. The company has expanded its production capabilities by adding six new farms, enhancing capacity utilization. A new mega hatchery and feed mill are expected to be commissioned in the second half of 2026.
Despite the positive revenue growth, Tanmiah faced challenges in profitability. Gross Profit and EBITDA were negatively impacted by rising input costs and declining revenues in specific segments of the Animal Feed and Health business. The EBITDA for Q1 2026 fell by 5.9% year-on-year to SAR 88.5 million, with the EBITDA margin decreasing to 12.1% from 13.9%.
Strategic Focus and Operational Challenges
Zulfiqar Hamadani, CEO of Tanmiah Group, highlighted the company’s disciplined approach in navigating a complex external environment. He noted that the diversified platform and proactive strategies enabled Tanmiah to maintain operational continuity and secure essential inputs. The emphasis on optimizing the asset base and improving cost competitiveness has been crucial in achieving revenue growth across both Agribusiness and Restaurant Operations.
The company is focused on advancing its strategic priorities, which include enhancing operational efficiency, optimizing asset utilization, and improving digital capabilities. These initiatives aim to build long-term shareholder value while addressing immediate market challenges.
Financial Highlights
The financial performance of Tanmiah in Q1 2026 is summarized as follows:
- Revenue: SAR 731.2 million (up 8.0% YoY)
- Gross Profit: SAR 166.8 million (down 1.0% YoY)
- EBITDA: SAR 88.5 million (down 5.9% YoY)
- Net Profit (Loss): SAR 1.1 million (down 95.4% YoY)
- EBITDA Margin: 12.1% (down from 13.9% YoY)
The decline in net profit is attributed to increased diesel and utility costs, heightened distribution expenses, and elevated financing costs linked to new assets and stores. The company reported a net loss attributable to shareholders of SAR 1.1 million, a significant decrease from a net profit of SAR 18.9 million in the same quarter of the previous year.
Segmental Revenue Analysis
The Agribusiness segment, which encompasses Fresh Poultry and Animal Feed and Health Products, remains the primary revenue driver, accounting for approximately 92% of total revenue in Q1 2026. Fresh Poultry revenue increased by 10.4% year-on-year to SAR 551.9 million, supported by higher sales volumes and improved average selling prices. Conversely, the Animal Feed and Health Products segment experienced a 12.3% decline in revenue to SAR 117.4 million, reflecting softer market conditions.
In the Restaurant Operations segment, revenue surged by 42.2% year-on-year to SAR 61.9 million, bolstered by successful marketing campaigns that enhanced customer engagement, particularly during Ramadan.
Cost Management and Future Outlook
The cost of sales rose by 10.9% year-on-year to SAR 564.4 million, driven by increased fuel, utility, and logistics costs. The gross profit margin contracted to 22.8% from 24.9%, influenced by the performance of the Animal Feed and Health segment.
Looking ahead, Tanmiah anticipates a gradual improvement in market conditions throughout 2026. The company aims to enhance the utilization of recently commissioned assets, advance cost optimization initiatives, and expand its product offerings in higher-margin categories. While challenges such as cost inflation and supply chain complexities persist, Tanmiah’s integrated operating model positions it well to adapt and thrive in a changing landscape.
Commitment to Sustainability
Tanmiah is also focused on sustainability, implementing a range of initiatives aligned with the Kingdom’s Vision 2030 and the United Nations Sustainable Development Goals. The company is advancing its decarbonization efforts and has made significant strides in renewable energy projects. The Haradh solar project is on track for completion in July 2026, and additional solar sites have received approval.
Tanmiah’s commitment to sustainability is reflected in its comprehensive portfolio of initiatives, which is expected to have a total EBITDA impact of approximately SAR 100 million. The company’s ESG governance framework is robust, ensuring alignment between strategic objectives and operational execution.
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_Published on 2026-05-10 21:11:00 • By the Editorial Desk_
