South African poultry-to-feed group Astral Foods has booked a jump in half-year earnings thanks to improved fortunes at its poultry unit.
In a regulatory filing, the company revealed operating profit rose 260% to ZAR212.9m (US$420.57m) in the six months to the end of March. Headline EPS increased 308% on the year.
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The company attributed the profit increase to an improved performance from its poultry unit, which posted profit of ZAR44.9m, compared to losses to ZAR116.6m in the year -go period. Last year, higher feed costs and increased imports hit the business.
Poultry sales were supported by both volume and value growth, Astral said. “Revenue for the division was up by 12.3%… on the back of higher broiler volumes which improved by 6.2%… Sales realisations increased by 5.9% for the period under review.”
Investec Securities analyst Anthony Geard said he is “cautiously optimistic” on the outlook for poultry pricing in the country, which he expects to be helped by the “high likelihood” of further protection for the local industry in the form of anti-dumping duties on EU imports.
“We are encouraged by the improvement in selling prices in recent months (+11% average improvement in October to March) and are cautiously optimistic that prices will rise further through the winter months as industry inventory levels, as reflected in cold storage usage, have eased to some extent,” he wrote in an investor note.
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