Almarai Co., the Gulf's largest diary company by market value, said on Sunday it will begin production on a SR650 million ($173.3 million) infant formula plant as well as a baked goods factory before the end of next year. The baked goods facility is slated to cost SR200 million, the firm said in a statement. “Most of the contracts for the civil and electric operations, as well as the production lines for the baked goods factory are signed and it is expected to start production in the first quarter of 2010,” Almarai said. The formula factory, which is expected to generate revenues of between $50 million and $70 million, will begin production toward the end of the last quarter of 2010, according to the statement on the Saudi bourse website. Almarai, which has been diversifying its revenue through acquisitions, plans to spend SR6 billion on expansion in the five years to 2013. It recently acquired two companies in the Middle East and is looking at more acquisitions in Egypt after last month's $115 million purchase of an Egyptian dairy firm. Earlier this month, Almarai reported a 22.1 percent rise in second-quarter net profits on accelerated sales growth. Profit in the three months to June 30 stood at SR287.1 million. Almarai, the Gulf's largest dairy firm by market value, recently reported its preliminary results for the second quarter and first half of 2009, registering 16 percent year-on-year growth in its Q2 topline, while its net income grew more than 22 per cent.
