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Directors Report :
English / Arabic |
Management Discussion and Analysis Report year ended 30th april, 2009.Industry (Business and Main objects)
Oman Agriculture Development Company is an Agro based Dairy Company involved in the business of supplying fresh farm products in the Sultanate of Oman thru shops and other establishments. Method of Business and Development
Dairy products are sold to retailers, hotels, Government Institutions and Caterers in the Sultanate of Oman thru a fleet of company owned refrigerated vehicles maintaining the required cold chain. The company has a policy of continuous development of core areas on advanced scientific lines.
Investment and Opportunities
Increased dairy product consumption and rise in the population of Oman provides an opportunity for investing in the growth of the company by increasing the existing and adding new range of products.Analysis of products.
The Company produces Fresh Milk, Yoghurt, Real Fruit Yoghurt, Laban, Jeera Laban, and Fresh Juices. Risks, concerns and mitigation.
Dairy business in the GCC countries is highly techno based and extremely competitive. Producers from neighboring countries have set up their own distribution and supply base for dairy products in the local market with fewer restrictions.
Dairy business will be the main strategic focus area and the emphasis is to sell higher volumes of better margin products to improve the profitability and to offset lower average sales price of the dairy products
The outlook is positive as there is a scope for further growth in the industry on account of population increase, change in consumer habits, and shift from carbonated drinks to fresh juices. Increase in product mixes should help the company in increasing the volumes. Discussion on Financial and Operational Performance
The revenue of the company has increased from RO 5,628,615 to RO 5,746,298 mainly due to increase in Dairy product sales.
Sales have registered a growth of 2%. Sales quantities sold were higher, but average realized prices continue to be lower due to severe competition from GCC countries.
Cost of Sales increases are mainly due to the increase in Cattle feed, Fodder and material used for Plastic packaging. The international oil prices in the third quarter decreased, also there was decline in other raw material prices except Fodder.
Selling and Distribution expenses have decreased due to lower incentives paid to retailers for shelf space and display rentals this year as compared to last year. .
Financial Performance of the company for the last 5 years is as follows;
Main Activities and Geographical Location.
The Company is in the business of Dairy and Agro farming, the factory is based in Sohar (Northern Batinah), its Sales office is in Ghala, (Capital area). The company has 286 employees.
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