Ghitha Holding

1. Company Overview & Earnings Context

Ghitha Holding PJSC is an Abu Dhabi-based, ADX-listed diversified food and agriculture group. Its activities span food trading and distribution, fresh produce, dairy and livestock, poultry, food manufacturing, vegetable oils and related investments. During 2025, Two Point Zero Group PJSC became the parent company, following the transfer of the former parent's entire shareholding. 

For the nine months ended 30 September 2026, Ghitha delivered strong top-line growth and a substantial improvement in consolidated profitability. Revenue from continuing operations increased 26.7% YoY to AED 5.07 billion, while total profit after tax more than doubled to AED 191.7 million. However, reported earnings benefited materially from an AED 85.4 million gain on the partial disposal of Apex Investment PSC, while the Group also continued to absorb losses from discontinued operations. 

The Group's operating portfolio is organised into five reportable segments: fruits and vegetables, dairy and protein, trading and distribution, edible oil and fats, and investments and others.

2. Financial Performance Snapshot

9M 2026 vs. 9M 2025

• Revenue: AED 5.072 billion vs. AED 4.003 billion (+26.7% YoY)

• Cost of Sales: AED 4.110 billion vs. AED 3.123 billion (+31.6%)

• Gross Profit: AED 962.2 million vs. AED 880.1 million (+9.3%)

• Gross Margin: approximately 19.0% vs. 22.0%

• SG&A Expenses: AED 779.2 million vs. AED 680.5 million (+14.5%)

• Share of Associates: AED 1.4 million loss vs. AED 50.2 million profit

• Gain on Partial Disposal of Associate: AED 85.4 million

• Profit Before Tax – Continuing Operations: AED 243.7 million vs. AED 219.8 million (+10.9%)

• Profit After Tax – Continuing Operations: AED 226.4 million vs. AED 199.2 million (+13.7%)

• Loss from Discontinued Operations: AED 34.7 million vs. AED 119.2 million loss

• Total Net Profit: AED 191.7 million vs. AED 80.0 million (+139.6%)

• Profit Attributable to Owners: AED 116.3 million vs. AED 48.5 million (+140.0%)

• EPS: AED 0.48 vs. AED 0.20

Q3 2026 vs. Q3 2025

Q3 performance also improved strongly. Revenue increased 23.4% to AED 1.717 billion, gross profit rose 5.5% to AED 296.0 million, and profit before tax from continuing operations increased 52.9% to AED 63.0 million. Total quarterly net profit increased to AED 64.1 million from AED 25.4 million, while EPS increased to AED 0.15 from AED 0.03. 

Underlying-performance note: Revenue growth was strong, but gross profit grew much more slowly than sales, resulting in gross-margin compression to approximately 19% from 22%. Furthermore, the 9M reported profit improvement includes the AED 85.4 million Apex disposal gain. Excluding this gain on a simple pre-tax basis, continuing PBT would have been approximately AED 158.3 million, below the prior-year AED 219.8 million. This highlights a meaningful difference between reported and underlying profitability.

3. Operating Performance & Major Programs

Ghitha's continuing operations generated all AED 5.072 billion of reported customer revenue through the sale of food and non-food goods. UAE revenue increased to AED 4.102 billion from AED 3.380 billion, while revenue generated outside the UAE rose to AED 969.7 million from AED 623.2 million, implying particularly strong international growth. 

The Group continued to expand its operating portfolio during 2026. Effective 1 March 2026, subsidiary NRTC Food Holding acquired a 70% interest in Taaza Healthy Food Industries LLC for AED 11.28 million. Taaza Healthy contributed AED 8.44 million of revenue after acquisition but recorded an AED 9.28 million loss during the period. 

Ghitha also acquired a 70% interest in Taaza Quality Foodstuff Trading LLC, further extending its food and fresh-produce platform.

Property, plant and equipment increased modestly to AED 2.176 billion from AED 2.160 billion at December 2025. The Group recorded AED 152.4 million of PPE additions during the nine months, indicating continued investment in its operating and production platform. 

Portfolio Rationalisation

The Group simultaneously continued portfolio restructuring. In March 2026, Ghitha disposed of 1.7% of Apex Investment PSC, reducing its ownership from 48.5% to 46.8%. The shares transferred had a carrying value of AED 119.4 million and consideration of AED 204.8 million, producing the AED 85.4 million disposal gain. 

Ghitha also classified Anina Culinary Art Ltd. as held for sale, while its Fisheries Group and another trading subsidiary remained within held-for-sale/discontinued operations. This indicates an ongoing effort to rationalise non-core or underperforming businesses.

4. Key Performance Drivers

The strongest driver was revenue expansion, with continuing sales increasing by approximately AED 1.07 billion YoY. UAE operations remained the dominant contributor, accounting for roughly 81% of revenue, while overseas sales expanded significantly. 

However, cost of sales increased 31.6%, faster than the 26.7% increase in revenue. Consequently, gross margin compressed from approximately 22.0% to 19.0%. This is one of the most important operating trends to monitor.

SG&A increased 14.5% to AED 779.2 million, although the increase was slower than revenue growth, providing some operating leverage below gross profit.

A second major factor was the deterioration in associate contributions. Ghitha recorded a AED 1.4 million share of associate losses, compared with AED 50.2 million of associate profit in 9M 2025. 

This underlying headwind was offset by the AED 85.4 million gain from reducing the Apex stake. The disposal therefore had a significant positive effect on reported continuing PBT.

Another important improvement came from discontinued operations. Losses narrowed sharply to AED 34.7 million from AED 119.2 million, an improvement of approximately AED 84.5 million. Nevertheless, discontinued businesses continued to dilute Group earnings. 

Anina's classification as held for sale resulted in an AED 25.9 million impairment, which was included in discontinued/held-for-sale losses.

Credit costs also moved higher: the cash-flow reconciliation shows AED 20.6 million of expected-credit-loss allowances, compared with only AED 0.9 million in the comparable period. 

5. Balance Sheet, Backlog & Cash Flow

Key balance-sheet and liquidity indicators include:

• Total Equity: AED 7.020 billion vs. AED 6.868 billion at December 2025

• Equity Attributable to Owners: AED 5.564 billion vs. AED 5.454 billion

• Cash & Bank Balances: AED 584.1 million vs. AED 555.1 million

• Cash & Cash Equivalents: AED 497.6 million vs. AED 491.8 million

• Bank Borrowings: AED 1.245 billion vs. AED 1.147 billion

• Non-current Bank Borrowings: AED 954.3 million

• Current Bank Borrowings: AED 290.6 million

• Trade & Other Receivables: AED 1.433 billion vs. AED 1.207 billion

• Net Trade/Unbilled Receivables: AED 1.126 billion

• PPE: AED 2.176 billion vs. AED 2.160 billion

• Investment in Associates: AED 3.984 billion vs. AED 4.142 billion

Borrowings increased by approximately AED 98 million during the period. Ghitha entered into a new AED 570 million term-loan facility, of which AED 370 million had been utilised by September. The facility is priced at EIBOR plus a margin and has a bullet repayment at the end of the third year from drawdown. 

Cash Flow

• Operating Cash Flow: AED 238.5 million vs. AED 252.4 million (-5.5%)

• Net Investing Cash Outflow: AED 222.0 million vs. AED 392.2 million

• PPE Purchases: AED 150.3 million vs. AED 80.3 million

• Acquisition Cash Outflow: AED 15.7 million vs. AED 483.1 million

• Borrowing Proceeds: AED 842.1 million

• Borrowing Repayments: AED 763.5 million

• Net Financing Cash Outflow: AED 8.7 million vs. AED 268.3 million inflow

• Net Increase in Cash: AED 7.8 million

• Ending Cash & Cash Equivalents: AED 497.6 million

Cash generation did not keep pace with reported earnings improvement. Working capital absorbed cash through an AED 85.8 million increase in inventories and AED 227.8 million increase in trade and other receivables, partly offset by a AED 178.4 million increase in payables. 

Ghitha does not disclose a conventional backlog/order book. For this food, agriculture and distribution business, revenue visibility comes principally from its operating portfolio, distribution network, production assets and continued portfolio expansion rather than a contracted project backlog.

6. Investor Takeaway

Ghitha's headline 9M 2026 numbers are strong: revenue increased 27%, continuing-operation profit increased 14%, and total net profit increased 140% to AED 191.7 million. Q3 also maintained positive momentum, with revenue up 23% and total quarterly profit rising to AED 64.1 million.

However, the quality of the earnings improvement requires careful interpretation. The AED 85.4 million Apex disposal gain materially supported continuing profit, while associate performance deteriorated from a AED 50.2 million profit contribution to a small loss. Gross margin also contracted by roughly three percentage points as cost of sales grew faster than revenue.

There are nevertheless positive underlying developments. Discontinued-operation losses narrowed dramatically, SG&A grew slower than revenue, international sales expanded strongly, and the Group maintained nearly AED 500 million of cash equivalents and more than AED 7.0 billion of equity. Portfolio rationalisation and selective acquisitions are continuing alongside investment in operating assets.

The main financial watch points are therefore gross-margin recovery, working-capital intensity, receivable quality, associate profitability, further losses from discontinued businesses and increasing bank debt. Receivables and inventories absorbed substantial operating cash, explaining why operating cash flow declined slightly despite significantly higher reported profit.

Accounting and review quality provide no immediate concern. The statements were prepared under IAS 34, and Deloitte conducted its review under ISRE 2410. Deloitte reported an unmodified review conclusion, stating that nothing had come to its attention indicating that the interim financial statements were not prepared, in all material respects, in accordance with IAS 34.  New IFRS amendments effective in 2026 had no material impact, while management identified IFRS 18 as the principal forthcoming standard requiring further impact assessment.  

Overall, Ghitha's 9M 2026 results show strong business expansion and a much improved headline earnings profile, but underlying profitability is less impressive than the reported 140% net-profit growth suggests. The next stage of the investment case depends on converting rapid revenue growth into stronger gross margins and operating cash flow, while reducing discontinued-operation losses and improving returns from the Group's substantial associate-investment portfolio.