VENTURES AFRICA – South Africa’s largest consumer goods firm Tiger Brands have posted a modest rise in first-half earnings, helped by growth in its exports and international businesses as its domestic market lull lingers.
The maker of bread, breakfast cereal and energy drinks announced diluted headline earnings per share for the six months to end of March rose four per cent to 766 cents ($0.09) on Tuesday.
Headline earnings are the main profit gauge in South Africa and exclude certain one-off items.
The company said revenue rose 12 per cent to 11.6 billion rand ($1.4 billion), and it declared a dividend of 2.95 rand ($0.36) a share.
Tiger Brands expressed pessimism as regards domestic consumer. In a statement, the company said; “domestic economic conditions will continue to be challenging for the rest of the financial year” and South African consumer spending “will remain under pressure.”
It also said expansion into new markets, mainly in Africa, remained its key strategic thrust.
According to the company, “expansion into new markets, primarily in the rest of the African continent, remains a key strategic thrust, both through acquisitions and exports.”
Tiger Brands, which has been ramping up its expansion in fast-growing African markets, last year increased its footprint outside South Africa with acquisitions in Nigeria and Ethiopia.
Earlier this month, the company was in acquisition talks with Nigerian billionaire industrialist Aliko Dangote over stakes in Dangote Group’s flour milling unit.
Reuters reports that the foods company declared an interim dividend of 295 cents ($0.04) per share, which signifies a 5 per cent increase from the interim period last year.
Tiger Brands shares also gained 6.5 per cent so far this year, compared with a 2.4 per cent rise in the blue-chip Top-40 index.