Establishing a flour mill in Qassim for 123 million riyals

Yesterday, the Board of Directors of the First Mills Company approved the establishment of a new flour mill at the company’s factory in Qassim.
According to the company’s statement on the Saudi Tadawul, the project will allow the addition of new production capacity that supports the company’s continuation towards providing high-quality products to its customers and expanding into promising geographical areas.
According to the company, the new milling unit (Mill C) will add 600 tons/day to the current wheat grinding capacity at the Qassim plant, an increase of 66% to reach 1,500 tons/day.
The First Mills Company obtained the approval of the General Food Security Authority (GFSA) for this increase in production capacity.
The project is expected to start in the first quarter of 2025, after obtaining regulatory approvals.
The total expected cost of the project is estimated at 123 million riyals.
She noted that the project will be financed through banking facilities compatible with Islamic Sharia, the company’s available cash liquidity and other available financing programs (including the surplus resulting from the allocation to modernize Mill B in the company’s factory in Jeddah).
The construction work for the project is expected to be completed in the second quarter of 2026.
The company expected that the financial impact of the project would appear in the company’s financial results for the year 2026.
It is expected that the financial impact of the project will be reflected in the company’s financial results starting in the third quarter of 2026.
She stated that trial production of the project is expected to begin in the second quarter of 2026.
The project’s trial production period will last for approximately 60 days.
Commercial production of the project is expected to begin at the end of the second quarter of 2026.
She explained that the implementing party or the other party to the contract or project is Buhler AG – a leading company in the field of manufacturing flour mills with its headquarters in Switzerland.
In reference to the announcement of the First Mills Company on 01/14/1445 AH (corresponding to 01/08/2023 AD) regarding the signing of a contract to purchase two new flour mills from Bühler AG to modernize the two grinding units (A and B) in the company’s largest factory located in Jeddah, the company announced the latest developments in this regard. In particular, the expansion and modernization work to increase the production capacity of Mill A was successfully completed as planned.
This expansion comes to support the increase in the company’s production capacity, as this modernization will increase the production capacity of the Mill – A from 300 tons per day to 550 tons per day, and thus raise the production capacity ceiling at the Jeddah factory, the company’s largest factory in terms of daily production capacity for grinding, to reach 3,050 tons per day. .
On the other hand, and in line with the company’s strategic expansion objectives, the company’s Board of Directors decided to approve amending the modernization and expansion plan for Mill – B at the company’s factory in Jeddah, which was planned to be completed in late 2025 AD. Based on the evaluation of the company’s vision for expansion and increasing production capacity, the first mills decided to replace that modernization by purchasing a new flour mill as an additional grinding unit, Mill-C, at the company’s factory in Qassim, with a completely new milling production capacity of 600 tons/day.
These expansion steps come in line with the company’s plans for growth, supporting the increase of its production capacities and enhancing its market leadership, as this amendment will contribute to meeting the growing demand and expanding into promising geographical areas to reach a new segment of customers in a way that provides the best value to the company’s shareholders.
The company will also announce any material developments in this regard in a timely manner.
It is expected that the financial impact of this expansion of Mill – A will appear during the company’s financial results in the fourth quarter of the year 2024 AD. As for the new mill, any expected fundamental developments will be announced at that time.