Abu Dhabi: Agthia Group, a food and beverage producer and distributor, reported on Wednesday nearly flat earnings year-on-year for the third quarter of 2016, with Dh54.8 million in net profit (a 1 per cent increase).

The figure brings net profit for the first nine months of this year to Dh200.2 million, marking an increase of around 12 per cent from the Dh179 million recorded in the same nine months of 2015.

Meanwhile, revenues for the third quarter were Dh477.9 million — up 2.7 per cent over Q3 2015 — while revenues for the full nine months rose around 11 per cent year-on-year to reach Dh1.5 billion.

In a statement, Agthia attributed the rise in revenues to strong performance in its water business, which distributes Al Ain water. Revenues in the water business jumped 27 per cent in the first nine months of 2016 to reach Dh488 million.

Iqbal Hamzah, Agthia’s chief executive officer, said the company is on track to grow both its top and bottom lines despite a challenging operating environment and the impact of subsidy cuts.

During the third quarter of 2016, Agthia’s flour and animal feed businesses were subject to a change in the government’s subsidy regime that has been in place since 2007, with the next phases of subsidy cuts expected to kick in over 2017 and 2018.

“Despite subsidy cuts, we are looking at sales growth of 7 to 8 per cent and profit growth of 8 to 9 per cent at the group level for this year. In 2017, we’re looking at another growth year on the top and bottom lines despite [subsidy cuts].

Yes, subsidy [cuts] will have an impact on our sales and profits but the consumer business, which has the highest profitability, is growing at a much faster pace than the flour and feed businesses [which are impacted by the cuts],” Hamzah told Gulf News.

As for expansion plans, the CEO said Agthia plans to strengthen its presence in the UAE’s Northern Emirates, and the overall GCC region, and plans to tap into the Levant in mid-2017. The company is also on track to land an acquisition within the GCC before the end of this year in the water and beverage business.

Agthia’s share prices ended the day flat at Dh6 on Wednesday on the Abu Dhabi Securities Exchange.