QUANTUM Foods said on Friday that its 2021 performance was below expectation as it posted its results for the year ended September 30, 2021.
Headline earnings per share decreased by 35 percent to 52.2 cents per share, while operating profit decreased by 34 percent to R144 million, from R220m in the prior corresponding period.
Trading conditions were challenged by higher feed costs, the South African outbreak of highly pathogenic avian influenza, the business closure of a Western Cape broiler abattoir customer, and muted consumer expenditure.
In addition, lower production at certain operations and above-target cost per unit increases in key product categories weakened the group’s overall financial results.
No final dividend was declared.
Looking ahead, Quantum Foods said the challenging trading conditions experienced by the poultry industry in 2021 were expected to continue in 2022.
It anticipated that feed raw material costs would remain high due to the expectation for international prices and cost of logistics remaining high. The cost of feed raw materials would further be influenced by any fluctuations in the value of the rand, primarily against the dollar, it said.
Quatum Foods said a further concern was South Africa’s weak economic growth prospects. Reliable electricity supply and the ability of municipal infrastructure were key requirements for economic growth, which would drive future consumer expenditure.
BUSINESS REPORT ONLINE