South African food group Tiger Brands has posted a dip in group earnings for the full year and said it expects tough conditions in the first half of this fiscal year.
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The company said group headline earnings for the year amounted to ZAR2.2bn (US$299m) compared to ZAR2.4bn in the previous year.
Turnover for the year ended 30 September, however, was up 8% to ZAR20.4bn, while operating income reached ZAR3.1bn, an increase of 24%.
Tiger said most categories achieved “pleasing” performances, and, even a fall in rice profits as consumers switched into more affordable carbohydrate categories, benefitted the company’s milling business.
Domestic food increased turnover and operating income by 10% and 38% respectively, while the snacks and treats division recorded a “pleasing” growth of 14% in operating income off an increase in turnover of 9%.
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By GlobalDataStrong performances were experienced in most FMCG categories, Tiger said, although underlying consumer demand weakened marginally in the second half of the financial year compared to the first six months.
Tiger reached an agreement to acquire Nestlé’s Crosse & Blackwell South African mayonnaise business in May.
The deal transferred ownership and management of Nestlé’s Crosse & Blackwell mayonnaise production plant in Bellville, Cape Town, to Tiger.
The company said it continues to expect difficult trading conditions in the first half of next year, mainly due to pressure on consumer spending.
However, it added that headline EPS is “expected to show satisfactory growth in real terms” for the full year.
