Alkis H. Hadjikyriacos (Frou-Frou Biscuits) delivered a steady performance in 2024, with resilient sales, stronger profits and a solid balance sheet.

The group benefited both from its established product lines and from the steady income generated by its large investment portfolio.

Turnover edged up 0.7 per cent to €24.39 million, but gross profit grew more quickly, rising 2.2 per cent to €9.08 million.

This improvement was mainly due to lower electricity and fuel expenses, following the rollout of a photovoltaic system that now supplies around 38 per cent of its energy needs.

At the same time, operating profit increased to €2.79m as administrative and distribution costs fell.

Personnel costs declined after headcount dropped to 184 from 192, while reduced vehicle and energy expenses added further relief.

As a result, net profit for the year advanced by 9.9 per cent to €2.46m, while pre-tax earnings rose by nearly 4 per cent to €2.63m.

The contribution from investments was also significant, with dividend income reaching €1.2m and gains of €1.12m from the disposal of listed shares.

Higher returns from gold holdings provided an additional cushion.

Even so, 2024 was marked by sharp cost pressures. Cocoa prices, one of the company’s main inputs, almost tripled due to poor harvests in Ivory Coast and Ghana.

However, management expects a correction this year, and the first-half figures for 2025 already confirm the trend.

Gross profit was up 4 per cent compared with the same period a year earlier, while net profit gained 2.4 per cent.

The balance sheet remains equally robust. Total assets climbed to €90.8 million, while equity rose to €73.5m.

Debt accounted for only 6 per cent of equity, and net financing expenses fell to €157,825, covered 37 times by earnings.

Moreover, the company managed to reverse a working capital deficit: current assets at end-2024 exceeded current liabilities by €0.53 million, compared with a €1m shortfall the previous year.

Alongside its manufacturing operations, Frou-Frou continues to rely on a substantial investment portfolio.

At end-June 2025, securities were valued at €29.7m and gold at €2.27m, both of which have benefited from buoyant markets in recent years.

Dividends contributed €1.2m in 2024, slightly above the €1m of the previous year.

Shareholders are also set to be rewarded directly. The board has proposed a dividend of €0.016 per share for 2024, up from €0.013, representing a yield of 4.7 per cent on an average closing price of €0.34.

The share trades at €0.44, well below its book value of €0.75 per share, with an estimated 2025 price-to-earnings ratio of 17.7.

Beyond financials, the company is pressing ahead with efficiency and sustainability initiatives.

It is assessing energy storage systems to complement its photovoltaics and is preparing automation of certain production lines, aiming both to increase output and to cut its carbon footprint.

Nevertheless, risks remain. The volatility of cocoa prices could still affect costs, and wider geopolitical uncertainty, from the war in Ukraine to instability in the Middle East and new US trade tariffs, could weigh on markets and supply chains.

Despite the above, management believes profitability from biscuits, cereals and snacks will remain stable, while dividend income from its investment portfolio will continue to underpin earnings, though valuations ultimately depend on stock market conditions.