Half-year profits at South African poultry processor Astral Foods fell by more than 80% as higher feed costs and increased imports hit the company.
Headline earnings for the six months to the end of March dropped 82% to ZAR36m. Astral’s poultry arm, its biggest division, swung to a loss of ZAR177m. A year earlier, the unit booked operating profit of ZAR140m. Group operating profit was down 80% at ZAR63.8m.
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Astral said imports from Brazil and the EU hit “record highs” in November and December, which led to an increase in promotions to clear the stocks. Prices fell and were not enough to offset higher feed costs.
Revenue was up 5% to ZAR4.23bn. Sales from Astral’s poultry division increased 3% to ZAR2.95bn.
Astral said the South African Poultry Association had applied to the country’s International Trade Administration Commission for an increase in tariffs on imports. The company and the rest of South Africa’s poultry sector are awaiting a verdict.
Meanwhile, Astral said the outlook for good maize crops in South Africa and the US was “less optimistic” after “unfavourable” weather.
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By GlobalDataClick here for the full statement from Astral.
