Bidcorp shares take a knock on muted growth
JOHANNESBURG - JSE-listed Bid Corporation (Bidcorp) share price slid by more than 4percent yesterday after the food service group said it expected to report muted growth in earnings for the six months to end December.
The muted growth in earnings reflected the challenging trading environment in many of its operational geographies, it said. Bidcorp was unbundled from Bidvest Group and listed separately in 2016 and has operations in more than 40 countries across the globe.
Bidcorp expected its headline earnings per share (Heps) from continuing operations to increase by between 3 and 5percent, to be between 721.2cents a share and 735.2c, up from 700.2c compared to last year.
“Earnings per share (eps) from continuing operations is expected to be between 3 and 5percent higher, to be between 719.7c and 733.6c compared to 698.7c reported in the comparative period,” the group said.
However, the group expects its eps from total operations to increase by between 20 and 22percent, to be between 674.5c and 685.8c, up from 562.c reported last year as a result of the capital write-offs incurred in the discontinued operations in the comparative period. The PCL distribution business in the UK was reported as a discontinued business by Bidcorp in the half-year results to end December 2018.
Its Heps from total operations was expected to be between 4 and 6percent higher, to be between 707.7c and 721.3c, compared to 680.5c reported last year. In the 2018 half-year results, Bidcorp reported a 9.1percent increase in revenue to R66.4billion while Heps increased by 9.2percent In October. Bidcorp announced its intention to dispose of its Best Food Logistics business in the UK, pending regulatory approval, as part of its strategy to exit non-core assets.
The group said that it would sell the logistics business to the Booker Group, a wholly owned subsidiary of Tesco plc, for an undisclosed amount. Bidcorp will release its half-year results tomorrow.
The share price declined to R314.85 a share after the release of the update, before closing 3.53 percent lower at R316.85 on the JSE yesterday.