The shares surged 16.13% to R5.40 after the group said it expected its headline earnings per share during the period.
Quantum Foods shares gained 5.38% on the JSE yesterday to close at R4.90.
“Shareholders are advised that in respect of the six-month period to end March, the company expects headline earnings per share of between 81.3cents and 83.7c, an increase of between 556% and 575% compared with the headline earnings of 12.4c for the previous corresponding period,” the group said.
Quantum Foods is a diversified feed and poultry business that provides quality animal protein to selected South African and African markets. Quantum Foods was spun off Pioneer Foods in October 2014.
It is a focused primary agricultural business that has four focus areas: animal feeds, eggs and layer livestock, broilers and related businesses in the rest of Africa.
The group has a presence in Botswana, Malawi, Angola, Zambia, Uganda and Tanzania on the continent.
In the last financial period, the group said that it had been negatively affected by the drought, which had led to a decrease in profits.
The company also counted increases in raw material costs, a volatile rand and a strained consumer environment as having an impact on its profits in the past. The country has since recovered from the drought, with the exception of the Western Cape.
Yesterday, the group said it expected its basic earnings per share to show a hefty increase during the period.
“The company expects basic earnings per share of between 81c and 83.8c, being an increase of between 483% and 503% when compared to the basic earnings per share of 13.9c in the previous corresponding period,” the group said, adding it would release its half-year results on or about May 24.
The expected earnings for Quantum Foods bode well for its largest shareholder, Zeder Investments, which holds a 26.7% stake in the poultry and animal food producer.
It also reported a 35.2% decline in recurring headline earnings per share to 27.6c for the year to the end of February as a result of a combination of decreases reported by some of its investments.
- BUSINESS REPORT ONLINE