Arabian Food Industries Company – Domty announced inking EGP 100m medium-term loan contract with the Commercial International Bank – Egypt (CIB) with the average interest rate defined by the Central Bank of Egypt. In addition, the two sides signed an US dollar medium-term loan equivalent to EGP 40m.
Ahmed Mohy Eldin, Investor Relations and Corporate Affairs Director, told Daily News Egypt that Domty signed the US dollar loan to partially finance installing a new bakery line, while the remaining amount will be self-financed in the Egyptian pound.
The production capacity of the new line will be 270,000 pieces a day. Scheduled to start operation in February 2020, the new line will be Domty’s third bakery production line.
As for the EGP 100m loan, Mohy Eldin added that it will be used to finance the company’s future expansion and capital expenditures for new products.
“Such financing shall be available for withdrawal within 12 months from the date of the first withdrawal or the withdrawal of the total loan,” the company noted.
According to the contract, the loan shall be repaid in 20 quarterly installments, starting after a six-month-grace period from the date when the withdrawal period ends, with the last installment due after 75 months from the date of the first withdrawal.
Domty accomplished profits of EGP 66.3m during the first six months of 2019, compared to EGP 98.13m, including minority rights, during the same period of 2018.
Domty operates in the food, beverage, and tobacco sectors, focusing on packaged food.
Domty aims to increase its sales to more than EGP 3.5bn in 2020, by introducing a new bakery line in early 2020.
The company made sales of EGP 1.3bn during the first half (1H) of the year, compared to EGP 1.2bn during the same period of last year.
Domty reported a 32% year-over-year drop in profits to EGP 66.3m, equivalent to $4m, during 1H 2019.