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Avalon Pharma: Geopolitical challenges ‘part’ of operating reality
Avalon Pharma CEO says geopolitical instability is a permanent operating reality, not an exception. H1 net profit rose 26% to SAR 55.7M, with margins holding at 62.6% as the company expands into new markets.
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Avalon Pharma treats geopolitical risk as a permanent operating cost, not an exception. The company's business model, CEO Mohamed Al Ghannam said in an interview with Argaam, was built on the assumption that conditions would not be ideal.
Supply chain diversification and a proactive risk-management approach have let the company maintain production and fulfill customer commitments without a hit to performance, he said.
The comments accompanied first-half results that showed net profit rising to SAR 55.7 million, up 26% from SAR 44.2 million a year earlier. Second-quarter net profit reached SAR 28.8 million, a 16% year-on-year gain.
Al Ghannam said the growth came from continuous investment in the product portfolio, operational efficiency, and commercial capabilities, alongside disciplined capital allocation. He described the profit increase as the outcome of strategy, not short-term measures.
The private sector drove revenue in the second quarter, contributing 73.1% of total revenue and growing 27.5% from the same period last year. The government sector, Al Ghannam said, remains a strategic pillar but follows the cadence of tender cycles. The export sector bounced back after first-quarter measures to reorganize operations.
“Revenue growth is not about the figure itself, but rather the quality of that growth and the strategic drivers behind it that support building the future of Avalon Pharma,” the CEO said.