Johannesburg - Sovereign Foods, which is in the midst of being bought out by Country Bird, says its half year results, should the deal go ahead, will come in at a loss.
The company notes it will hold an annual general meeting on October 19 to consider Country Bird’s offer. It adds, because of the uncertainty around the deal, it cannot yet determine how to deal with the costs for the six months to August.
As a result, its trading update is based on the deal being implemented and the costs associated with it being deducted from equity.
If the deal goes ahead, Sovereign says its earnings and headline earnings per share will come in at a loss of between 38.5c and 47.5c, compared with a gain of 89.6c and 89.7c a share a year ago.
Should the deal not go forward, the company will still make a loss, although this will narrow to between 47.5c a share, and 56.5c a share.
It says its earnings and headline earnings per share for the first half include “extraordinary, once-off costs (“Once-off Costs”) associated with the defence of the hostile action brought against Sovereign by Country Birds’ concert parties as well as the offer.”
This loss comes despite a 35 percent increase in sales volumes, its statement issued on Monday shows.
IOL