Johannesburg –
Food producer AVI says revenue for the 6 months to December was 11.6 percent
higher, despite a constrained trading environment.
In a statement
issued on Tuesday, the listed company said the growth reflects a combination of
price increases in response to a weaker rand and higher raw material costs, “and
contextually pleasing volume growth in most of our grocery categories”.
In says, in the grocery
portfolio, selling prices have yet to fully recover rising input costs;
notwithstanding the margin pressure resulting from this, Entyce and Snackworks
both performed soundly with good growth in operating profit for the semester.
The group, which
also plays in the fashion space, adds overall performance by these brands for
the first half was “sound in the context of the difficult trading environment”.
Demand during
December for its core brands was good, with Spitz, in particular, achieving
solid revenue growth compared to December last year, it said.
Both Spitz and
Green Cross achieved operating profit growth for the semester despite pressure
on footwear sales volumes at the materially higher price points necessary to
protect gross profit margin.
Indigo Brands
delivered a pleasing result for the semester with gains in market shares in key
profit growth for the semester from favourable exchange rates and improved
fishing in the second quarter, although the result was tempered by a 3 week long
illegal strike at the fishing operations in August which resulted in a
shortfall of about R25 million of operating profit, and impacted negatively on
the group’s trading result for the first half, the company says.
As a
consequences, AVI – which notes there are 0.8 percent more shares in issue
because of new shares issued under its various share schemes – expects headline
earnings per share to be between 7 percent and 9 percent higher.
This puts this
key indicator of a company’s financial performance at between 301 and 307c a
share.
It adds consolidated
earnings per share for the interim period, including capital gains and losses,
are expected to increase by between 8 percent and 10 percent, or a range
between 302 and 308c a share.
Its results
should be released on March 6.
BUSINESS REPORT ONLINE