Edita Food Industries Company (S.A.E) (EFID) Earnings Call Transcript & Summary

Hello, everyone, and sorry again for the delay. This is Mirna Maher from EFG Hermes, and welcome to Edita's Fourth Quarter 2024 Results Conference Call. I'm pleased to be joined today by Hani Berzi, Group Chairman and CEO; Sameh Magdi, CFO; and Menna Shams El Din, Chief Investment Officer. We will first start with a quick update from management, and then we'll open the floor for the Q&A session. Hani, please go ahead.

Thank you. Thank you, Mirna, and apology once again for the delay. Good afternoon, ladies and gentlemen, and thank you for joining our full year 2024 results call. Once again, I would like to extend my gratitude to Mirna Maher from EFG Hermes for hosting today's call. Joining with me today is Sameh Magdi, our Deputy CEO, Menna Shams El Din, Chief Investment Officer; and Corporate Affairs, Ahmed Samy, CEO of Edita Food Industries Business Unit. We have closed another year with revenue record-breaking and operational achievement. I'm very pleased with our ability to excel and deliver on our strategy in a challenging economic environment. One of the key factors behind our success was our ability to respond to shifting market dynamics. Revenue growth was driven primarily by strategic repricing initiative in response to devaluation of the Egyptian pound and the consequence inflation. Inflationary pressure have passed significant economic challenges and surge in costs. We were able to successfully navigate the environment through prudent -- we are able to successfully navigate the environment to prudent pricing adjustment and by effectively leveraging our FX resources. Our business model is agile and continuously adapt to the evolving landscape, ensuring our pricing mechanisms are aligned to fluctuating cost structures. Delving into the number, EBITDA recorded revenue of EGP 16.1 billion, up by 33.2% year-on-year in 2024. And the net profit level, the company generated EGP 1.4 billion with a net profit margin of 8.8% for the year. The Cake segment remained our largest revenue contributor accounting for over 50% of the year's revenue. We are seeing strong migration in the segment or higher price point, which will support long-term profitability. In the Bakery segment, we repriced our portfolio aggressively with the highest price point now reaching EGP 20. We are actively working on increasing volume within the segment and expect to see a recovery post-Ramadan, which is typically a slow season for snack food product. Our smaller but high potential segment also demonstrated remarkable growth during the year. The Wafer segment grew 60.8% year-on-year supported by chocolate substitution. The Candy segment posted an impressive 57.6% year-on-year growth, driven by both surge in volume and price increases. Finally, the Biscuit segment more than doubled its revenue year-on-year. This year, we expanded further in the multibillion category by launching the plain biscuit subsegment. We aim to capture a bigger portion of this segment, which is sizable relative to low to total biscuit market. Moving forward, we will continue driving revenue growth and profitability across our portfolio. We are continually expanding our capacity and investing in our distribution channel to enhance penetration within key segments, expanding into new revenue streams by starting third-party distribution. Shifting focus with the regional front, our net export sales significantly increased year-on-year and now contributed 9.7% of total revenue for the year. Edita Morocco continued to deliver good results, supported by a restructured distribution network. Edita Morocco now also serves as an export hub for us into West African market, and our first shipment to Mauritania was completed in November last year. Earlier this year, we signed an agreement to acquire 49% of Tuama Jebur Abbas in Baghdad, a local family-owned manufacturer. Iraq and one of the region's most and high-growth market, and we are delighted to have fast entry into an extremely under -- an extremely under severe market that luckily, we already have brand equity and strong presence in Iraq. Iraq is one of our main export market with the operational facility equipped with 3 production lines, we are eager to begin operation in the second half of the year in what will be our second offshore facility. We also plan to add a new bakery line by quarter 3 2025. Looking ahead, I'm optimistic with inflationary pressure expected to come down in second quarter 2025. We are going to go through a more stable environment with real income improvement reflecting on consumer purchasing power. Our strategic priorities remain focused on portfolio diversification into new revenue streams, operational efficiency and regional expansion. Our proactive approach, market leadership and focus on providing high determent products alongside our diversification and expansionary strategy position us well for sustained growth and profitability. With that, I will conclude my remarks, and hand the call over to Sameh, who will walk you through the numbers before we open the call to questions. Thank you very much. Sameh, please take the lead.

Thank you, Hani. Ladies and gentlemen let's review the main highlights of Edita's results in '24. Our revenues reached EGP 16.1 billion, a 33% increase compared to '23. This impressive growth was driven by price adjustments. The average price per pack rose by 38% year-on-year to EGP 4.2 and we sold 3.8 billion packs during the year. In terms of segment performance, the Cake segment led our revenue growth to the 37% year-on-year increase, driven primarily by 43% year-on-year rise in the average price per pack. This was followed by the Bakery segment, which grew by 14% year-on-year, supported by a 43% year-on-year increase in average price. Moving to the gross profit. We saw 25% year-on-year gross to EGP 4.9 million. Our margins remained solid at 30.4%, despite the highly inflation rate environment and a series of devaluations, which continue to push up direct material costs. SG&A expenses as a percentage of sales edged up to 16.4% from 14.3% due to our ongoing extension efforts. EBITDA grew by 7.3% year-on-year, reaching EGP 2.5 billion, with a margin of 15.7% compared to 19.5% in '23. We achieved a net profit of EGP 1.4 billion with a net profit margin of 9%. Our balance sheet remains robust with cash reserves of approximately EGP 1.3 billion as of December '24. Total loans and borrowings stood at EGP 3.5 billion, up from EGP 2 billion at the end of '23. Our net debt-to-equity as of December 31, '24 stood at 0.55x coming from 0.2x. Edita secured new debt facility during the year, including long-term EGP 990 million loan from Banque Misr to support the company's growth and expansion initiatives. Currently, 50% of our total debt has been needed in foreign currency and 50% [indiscernible]. This includes USD facilities, as an all strong IFC secured in October '22 for a total value of $45 million, of which $10 million has been used for debt repayment. Our capital expenditure for the year amounted to EGP 1.2 million, primarily driven by the expansion of related investments in the cake and bakery production lines, followed by expenses for our fleet -- distribution fleet. This concludes our review of the Edita's performance of '24, and we can open the floor for discussions. Mirna, please open the floor. Thank you.

[Operator Instructions] We'll have a couple of questions on the chart from Omar. Could you please provide an outlook on EBITDA margin for the next 2 to 3 years? And do you have a long-term target over the next 5 years?

Sameh, can you shed some light please?

So I think -- in '23, our EBITDA margin stood at 19%. '24 with continuous evaluation and significant pressure on the operation, we dropped to 15.7%. We plan to retain our 19% within the 3 years, growing probably around 1% to 2% every year to reach that 19%, which was the same place in 2016 after the devaluation when it dropped from 20% to -- I think 15%. And we managed throughout '17, '18, '19, to retain our EBITDA margin. Thank you.

The next question is, can you provide an outlook on SG&A costs and guidance as a percentage of revenue or in absolute terms for 2025 and in the long-term?

Sameh?

So in the SG&A cost, we're planning for '25 to be in the range of 19% -- 18% to 19% and start declining this percentage to 16% in the years to follow.

We'll take the next question from the line of Sergey.

We cannot hear the question, actually.

Sergey, we can't hear you. Sergey, if you want you can type your question in the Q&A chat because we can't hear you. We'll take the next question in the chat also from Omar. Are there any expansion plans organically or inorganically in Egypt or Italy? And what would be the investment criteria in terms of size and IRR volume?

Yes, we have -- we will always be looking at expansion organically or inorganically in Egypt. Egypt will always remain our forecast market. It's the biggest market in the region, and we are very well positioned there. And we are continuously looking at opportunity, but nothing that we can share at this moment or something solid. On regional front, yes. we are in the strategy that we have put for the year 2027, we have set a target to be present in 2 additional territory in addition to Morocco. Of course, we have already signed one for Iraq. And we are working very thoroughly to achieve a second territory in the region also because we do believe that we need to in power and cement further our revenue stream in U.S. dollar from the region, especially in territories that we had already a good presence like Iraq, where we had very solid export there, and due to some restriction and from the Iraqi part, they have stopped importation of some goods to Iraq and I'm very happy with the quick and fast move that we have done in order to recuperate back our market in Iraq by this investment we have done.

The next question is on your dividend policy. What's the policy in the medium to long-term? And do you see room to materially increase the payout ratio?

No, the same strategy we always had -- we -- what we always have done over the past year is to distribute 50% of the realized profit every year to distribute to shareholders. And this will eventually continue along the way. Thank you.

The next question is could you provide a volume and price guidance for 2025?

Ahmed Samy, would you like to take the lead here?

Thank you, Hani. Actually, when it comes to volume, definitely as a reaction to the price -- significant price increases that has been witnessed in the market, we're expecting to have a single digital drop in volumes. However, in terms of -- when it comes to top line, it is expected to increase significantly in reaction again to the increase in average price points where -- when it comes to the revenue, we're expecting to have an increase of almost 31% in terms of revenues as a total top line. And again, as I mentioned, this is mainly a reaction to the increase from average price points, the introduction of new offerings and propositions across all categories at higher price points than the previous ones we have. And this is meant to offset the impact of drop in volume that is witnessed across the whole macro snacks market and reaction to the price increases.

Thank you. Thank you, Ahmed.

We have a related question from Sergey. The volumes have been dropping in the cake and croissants and volume drop accelerated in Q4. Why is that? And what is your expectation for volumes for 2025? How much room do you have to raise prices?

Okay. Ahmed, would you like to take the lead?

Thank you, Hani. Yes, definitely, as I just mentioned, we have a drop when it comes to the croissant and bakery in terms of volume. This drop was more significant within the Bakery segment due to the fact that we exited from very strategic price points, which are -- which is, for example, the EGP 10 when it comes to the Bakery segment. And this has indeed a drop in volume of almost 20%. However, when it comes to the cakes category, the volume drop was less significant, it's around 4%, and this is due to the fact that we were able to sustain our price points across the different brands within this category. So we did not bump any of the price points that we had or the entry price points that we have previously, so it showed more solid performance in terms of volume and the drop was only 4%. Again, the increase in revenue on cakes was 37%. And here, it is actually the impact of introducing new price points such as the EGP 10 across different bands. And for the Bakery segment, as Hani has previously mentioned, we've also introduced new price points such as the EGP 15 and EGP 20, which are growing in volume significantly month-after-month, and we're expecting that they will offset any drop in volume in the coming future, in addition to the fact that throughout the past month, we've seen that we are witnessing certain volume recovery and this will continue to happen until the end of 2025. So we will see the recovery throughout the year, very significant and especially after the Ramadan or post Ramadan after Eid and because this is the rule -- [indiscernible] low season for the macro snacking, and we're very optimistic that this will also be reflected in other categories other than cakes and bakes as well.

Thank you, Ahmed.

If you can provide guidance on the expected volume recovery in the Cake segment for 2025?

Ahmed, go ahead whenever you're ready.

Okay. And when it comes to the recovery in -- when it comes to the recovery in volumes for cakes, we're expecting that it will drop to around 2% in terms of volume growth versus the 4% that we had in the previous year. And again, this -- this will be reflected also in other categories going forward that you'll see that the volume drop will continue on getting less and less with -- as we progress within 2025.

I also -- I also if you allow me, Ahmed, I also believe that the market will stabilize now that we see the inflation dropping. We have seen the inflation dropping to 12.4% last month. I think the market will stabilize. For sure, we have been very aggressive in pricing in order to at least try to maintain our bottom line, which despite that has been affected. And we -- I have to say that we did not want to move in price increase post the devaluation. We want to give some time to understand the dynamics of the market before we do so. And that's why you -- like you rightly asked why the volume growth in Q3 and Q4 is because we have started implementing those price increases. Eventually, like we have previously seen with aggressive devaluation like the one we have witnessed, the market response is always defensive, and we lose a portion of our consumer. Nevertheless, as Ahmed said, we are expecting post-Ramadan after we have adjusted all our portfolio. And hopefully, we don't see further aggressive devaluation, which hopefully will not happen again, things will stabilize, and we will start recovering volume slowly, slowly.

The next question is, what would you highlight as the biggest risks for the next 2 years?

That's a good question, but I don't know exactly what would be the 2 big risks. Personally, on company level, I don't see any risk. On country level, again, I don't see any risk. I think we are -- on the economic side, we are on the right track. We have -- we've got another revision on the World Bank that it was approved. One risk that I would see if you have to be honest, is what was declared today about some reforms on the VAT tax and try to normalize all VAT to 14% that could have an impact on our portfolio definitely because we are in the bracket of 5%. Yet that's a risk, but I don't know how it will be tackled. And I don't know what the legislation will come out for Apart from that, I don't see anything that can affect our business.

The next question is from Sultan [ Al Shaalan ]. How would the 30% increase in sales translate to bottom line? Do you expect any headwinds related to raw materials and other expenses in 2025?

Sameh, do you want to talk on this question?

So I think we were just speaking on the first call about the improvement on our EBITDA motion and that we should be growing by an additional 1.1 average percent every year. So the 30% top line would translate to somewhere around 40% of EBITDA level, 37% to 40% on EBITDA level. Our net profit, it could grow a bit higher with the expectations of interest rates stock [indiscernible].

We have a couple of questions on CapEx. What is your guidance for 2025 and for the next 3 to 5 years? And what is the expected split in CapEx between local and regional markets?

So next year planned CapEx, including some overflow of existing projects in '24 would amount to EGP 1.2 billion. Most of this CapEx is for the local market in Egypt. Additionally, we will still need to reflect on top of this EGP 1.2 billion required investments for the Iraq project, which will be around $8 million for '25. Going forward, we expect to have a similar split of around EGP 1 billion mostly in capacity expansion in the Egyptian market and around $10 million to $15 million for the regional expansion, okay?

The next question is have the aggressive repricing exercises led to market share losses at any of your segments?

Ahmed, can you take the lead in this question, please.

Yes, sure. Definitely, it was slightly reflected on market share, especially due to 2 main factors. First of all, if -- if you recall during the volatility time that was witnessed in year early Q1 and 2024. A lot of the main players within the micro snacks' segments were not even to source raw materials. Now the stability that was established in the market we see these players going back to the market and we see that their offerings are started to be reintroduced to the market. So this will have an impact from one side. The drop in volume was definitely reflected somehow in market shares. However, we still maintain our dominance when it comes to the cakes category with almost 64% market share. In bakery, we have 54.3% in terms of market share and in wafers is 50.4%, and salty snacks here we saw a more significant drop between 45% in terms of work and market share. And this was, again, due to the fact that we exited certain entry price points. However, in the following year, we see that this is -- this drop has been recovering with the introduction of additional and new higher price points. When it comes to candy's, we reached 8.4% market share. And in biscuits, which is still definitely a new segment that we introduced. We've still been below 2%, but we're growing this as we do -- because as I mentioned, this is a newly introduced segment. So across and -- at least 5 out of the 6 categories that we operate in, we still have leadership over these segments, and we are still maintaining this leadership despite slight minimum drops across each and every segment as a reflection for the different price increases that we can -- and this is definitely going forward, we're expecting to see a rebound for these market shares as a reaction to the newly introduced price points, which were not yet reflected in market shares within the senses of the retail.

And the next question is, what's the strategy for maintaining working capital in the near term? And just to clarify, are you putting a pause to price increases to support volume growth?

Talking about the working capital. We -- on the synergy side, we remain selling on cash and we don't see changes in number of days outstanding on receivables. One of the biggest challenges that we have in '23 and '24 was the availability of materials, the possibility of importation in the Egyptian -- into the Egyptian market with ongoing challenges that we face and hence, we have to increase our inventory levels. And we've seen we lost probably around 10 days of inventory of implemented inventory that increase our inventory to EGP 3 billion by end of '24. We currently plan to reduce our inventory levels again in the study you see in the Egyptian market and the availability of commodities and so on to reduce our working capital by an additional 10 days. This is an improving significantly in our net debt position. This is for the working capital. For the second part I leave it to Ahmed.

Thank you, Sameh. When it comes to price increases, actually, we don't foresee any mutual further price increases going forward given the stability that we can waiting on macro level. However, as we mentioned before, we've introduced a richer experience to the consumer at price points that are expected to affect our average consumer price, but this does not include that we are planning for any further price increases at the moment. And as the usual practice, we've been -- when it comes to our pricing strategy, we've been always reactive to happening on the macro level, and we never move into price increases unless we need to pass the inflation to the consumer that we've been successfully doing for the past years. Thank you.

The next question is, how are cocoa prices impacting you in 2024? And do you expect any pressure from cocoa in 2025?

Sameh, do you want to state our position here when it comes to cocoa and what stock we have and where we are exactly?

We have the different types of cocoa, we're losing [indiscernible] inventory, covering up to Q3 '25. So we do not expect a significant impact on most of our category, some specific types we have to increase price increases for sure and will be reflected on our cost as of end of Q2 in the local market. Seeing cocoa prices [indiscernible] detail based on our long external contract. Cocoa prices [indiscernible], cocoa represent around 10% of our cost of material. So that should -- during the March this week could be the impact on overall cost of materials for the [indiscernible].

Thank you, Sameh.

The next question is on bakery volumes. What is the bakery volume growth expectation for 2025? And how much are the newly introduced category is growing?

Ahmed?

Can you repeat the question again, please?

What is the bakery volume growth expectation for 2025? And how much are the newly introduced categories growing?

Okay. When it comes to the Bakery segment, definitely, we are expecting an increase of around 35% in terms of top line, and we will not -- and what I can say regarding the new segments that we're penetrating, definitely. In this case, we are leveraging on that fact we stepped into [indiscernible] manufacturing agreements on the biscuit side, and this is where...

No Ahmed, we are talking about the Bakery segment, not -- I don't know biscuit is not included, I think, in the Bakery segment.

Thank you, Hani. I hope that the second part of the question is related to the biscuits, I misheard.

No, no, no worry. No problem.

Okay. So when it comes to the -- when it comes to the bakery. As I mentioned before, we're expecting a revenue growth of over 30% versus the previous year. And definitely, we are planning to have new introductions at different price points that -- and we started year by introducing a new premium offering, which is [indiscernible] booking and that have been significantly performing well month-after-month since its launch. And we're expecting to see further growth on this segment specifically coming from the one-piece offerings.

The one that we really -- we really suffered because the price increase is on the mini Molto croissant because of the -- it is the most really difficult and the most difficult SKU really when it comes to repricing because the consumer doesn't buy by weight, buy by a number of pieces, and it's always very complicated to come up with an offering that will be value for money to consumer. If you want to go to a nice proposition, we always have to price. Anyway, we have repriced the whole portfolio beginning of -- since now a month, a month half ago, and we expect this to be reflected on volume. What is the percentage of volume recovery? We cannot really assume it at this stage. Thank you.

The next question is any update on the competitive landscape?

No, there is no update on -- we don't see the competitive landscape remain the same, always new smaller entry penetrate the market from time to time. And as you can see, and Ahmed mentioned earlier, despite the volume drop, we have not been impacted significantly on our market share or let's say, replace the impact was really insignificant, and we will continue depending those market share, that's for sure. But again, on the competitive landscape, we don't see any change at the time. Thank you.

The next question is from Romie Azor. What are the metrics or guide for your expansion CapEx, especially regionally? Do you consider an IRR target? And how will you fund these investments?

Sameh, would you like to take the lead.

I think for the expansion CapEx, we've set the -- what was seen in the remainder of the call, adding 2 additional markets. The first one, the [indiscernible] we signed the RPD. I think we are planning to invest over the next 3 years in Iraq around $30 million. The second opportunity would be more or less in the same size, I guess in terms of sizing for the investment. The funding, we have already facility with the IFC for $45 million. We consumed out of this facility drawdown $20 million, and we still have $25 million, that will go to finance in Iraq, have the remaining portion will go to finance the additional opportunity. We will still look within the local markets for minimizing our exposure to raise local debt in Iraq and in other markets, looking for around a 50-50 debt equity ratio. In terms of returns, I think we cannot really share the details of this information and in our value depending on the risk appetite to the each quarter. Thank you.

The next question is from Ali Suruwat. If the government decided to standardize the 14% VAT versus the 5% that you're currently paying. How would you react in terms of pricing? Will you fully pass the increase in VAT to the customer?

That's not -- if you want to answer because I think -- it will be a mix of different in some segments. We can have a full pass on [indiscernible] or we need to evaluate the volume impact and maybe a short part of it. And it's important that the 14% currently we pay only 5%, but we do not collect retail on the input, so the 14% moving from 5% to 15% will be partially compensated by collecting our inputs. So the impact is 6% on top line. And then this 6% how we will split between the company and the consumer. I think that's around the size we still need to conclude internally. Thank you.

The next question is, can you talk about competition in key categories?

Ahmed?

Thank you, Hani. Okay. If we start with the Bakery segment, as we've seen last year, this category has been stable overall. We've seen that a lot of competitors have now been following our footsteps in terms of introducing high price points of new offerings at the same price points that we recently introduced to the market. However, given the equity of our brand, we still maintain our dominance and our leadership. When it comes to cakes, what I can say about cakes is that most of the competitors were not able even to follow the high price points that we introduce to the consumer. They try to again to get bigger size offerings at full price points in order to gain market share. However, as I mentioned before, we've been stable. We showed a lot of strong equity when it comes to our brands and consumers still prefer to go to high-quality offerings across the different price points. If we look into wafers, wafers has been a success story. We've seen that we benefited a lot from the fact that people are migrating from the chocolate category. And now they are -- the wafers, especially the coated segment of it. It represents a good substitution of chocolate. So we have an increase of 60% in terms of revenue and was also reflected on volumes. And we've seen -- we are expecting this trend to continue, especially with the up price in cocoa prices that we've seen lately. So we're expecting further and further growth when it comes to the Wafer segment mainly triggered by the cocoa segment of it. If we look into rusks, rusks, we then see any new introductions that has been done to the market, and we've seen that we're sharing leadership with the -- on this segment with PepsiCo with their flagship Sunrise. And we still playing musical chain when it comes to the leadership on this segment. And we're expecting that the situation will continue as such. If we look into biscuits, biscuits the market, again, has been growing. Definitely, we have a good opportunity to grow within this segment based on our newly introduced coated offerings, which are again investing from the fact that people are migrating to more affordable offerings coming from chocolate, which have witnessed a significant price increase. And as I mentioned, this trend is expected to continue given the recent prices of cocoa. So I think that, again, as we mentioned, there are currently -- there are no disturbance in our markets, and we've seen stability, and we're expecting that the new offering that we introduced across all categories to continue to grow given the stability that we currently see in the market. Thank you.

We have a couple of questions from Mehdi [indiscernible]. What is the optimal SG&A to sales given mounting competition in Egypt? And are there any restrictions on profit repatriation from Morocco and [indiscernible]?

Sameh?

I think we are looking to SG&A at 16% to normalize. And I think this should be additive to them within our competitive market, whether on distribution cost, whether on improvement and maintaining our tenant, this would allow us to remain competitive on different parts of the SG&A as a result. We don't see any issues on dividend repatriation from Egypt to our foreign shareholders. We do not see as well, we did not tested in Morocco or in Iraq. The current regulations in both countries are precedent and fair, allow dividend repatriation scheme. Big lengthy process in Iraq, but still doable in foreign currency available and should not [indiscernible]. Thank you.

We have a follow-up question on CapEx, what is the guidance beyond 2025, if you can repeat that? And is the $8 million for Iran included in the EGP 1.2 billion fixed guidance for 2025?

It's not Iran, it's Iraq.

So I think that what we said that EGP 1 billion to EGP 2 billion, that's the local market, and we expect in Iraq to spend $30 million, inclusive of the first $8 million over the next 3 years. So that's the -- what was the second part of the question, sorry?

The guidance beyond 2025 in terms of CapEx.

As we spoke about maintaining probably level of EGP 1 billion to the local market, mostly the expansion, and EGP 50 million in externally. Now these numbers could be fr sure impacted with currencies and evaluation. So historically, we have been focusing as 8% of revenue, in general on our CapEx, split as 5% expansion and 3% replacements. We used to be at 10%, but there was a different level of the pro now in that 8% of revenue.

The next question is on the Iraqi market. If you can talk about the market, how big it is, what categories are most promising? And how does competition look like there?

Well, Sameh, you want to share some of the information we have?

Yes. I think we have been -- in Iraq in the past -- for the past 12 or 13 years on the croissant or on the bakery and cake segments where we developed a leading position there. In the overall market, we're talking about $250 million for the Cake segment, and a bit plus for the croissant $180 million market on both segments. Our data -- market data that is very difficult and these numbers are been or higher revenue. In terms of competition, the Iraqi market is -- we don't have a lot of local producers, and the competition is either in food products from Saudi or from Iran or Turkey, where the Turkish products have [indiscernible]. Nevertheless, as of the beginning of '24, the Iraqi government spot and put ban on the production of similar products. We should start seeing local producers, getting the higher market share is one of the reasons for [indiscernible] while we move to the local production. And we expect other competitors from the GCC area to follow us well with local production, is something from greater than Edita giving us stronger [indiscernible].

I think you've already answered this question, but do you provide any IRR targets for your regional expansion?

[indiscernible] our target and a good value based on the risk and advance for each area.

We'll take the last question in the chart from Mohammed Husni. What is the expected exports contribution to revenue post Iraq and the same territory?

I think we would like to maintain our export level in the guidance of 10% to 11% of our top line. We are cementing our position in important market like Libya, like the West Bank in Palestine, like Jordan and many other countries that we have recently penetrated. We are also very keen on increasing our exports from our Moroccan subsidiary there to West Africa, as we mentioned in the beginning of the call, we already penetrated Mauritania, and we have plans to penetrate other countries in the Western African continent. So a 10% to 11% -- percentage of revenue will be a target for next year.

We actually have one last question in the chart from [indiscernible]. Would you consider entry to the healthy snacks business. Wouldn't it cater to a fast-growing segment that is becoming more health conscious?

Yes. This is definitely in our agenda. We are working with our renovation with our R&I center, which we have in the company. As I said, we have a Research and Innovation department that is quite solid and one of the mandate on the road map of products that we would like to launch is the healthy snacking proposition. We are considering and we are evaluating at the moment, which of those categories that we can penetrate. And definitely, once we have something solid, we will launch to the market. Thank you.

We've covered all the questions in the chat. So back to you, Hani, if you have any concluding remarks.

Well, thank you, Mirna. I think we have covered the most of the questions that we were asked today, yes, we understand that results are not the best even for me and my team. We are not very satisfied of what we have achieved in '24. Nevertheless, I'm also very happy that we managed to negate safely in a very turbulent environment in 2024. We have seen severe inflation. We have seen severe devaluation that have impacted our cost of goods sold and all cost center in Edita and we had to react. We were a little bit slower than usual on reacting to the price increase because, as I earlier mentioned, we needed to see and understand clearly the market dynamics and where they will land before we move and change our prices. Changing prices is not something a push off the bottom. It entailed a lot of adjustment and change whether on machine, whether on packaging, whether on dimensions of product and volume, this is not a quick fix. This is something that takes a lot of work. I hope -- I sincerely hope that we don't see such a move -- aggressive move in 2025 because it disturbed the whole business. Anyway, we are on track. We're back on track. We have revamped the whole portfolio. We have secured our raw material. We have all the talent in place to come back to what we used to achieve in the past, and we will do. That's our job. I'm very confident that numbers and bottom line, whether on EBITDA and profit. On top, definitely of top line revenue and market share will remain solid over the next year's. Thank you very much again for joining the call, and Happy Ramadan [Foreign Language ]. Thank you.

Thank you, everyone, for joining, and thank you, Edita's management for your time. This concludes today's call.

Thank you.

Thank you.