News

Industries

Companies

Jobs

Events

People

Video

Audio

Galleries

My Biz

Submit content

My Account

Advertise with us

FMCG News South Africa

SA food producer Libstar's annual earnings fall

South African food producer Libstar on Thursday, 16 March reported an 11.8% fall in full-year earnings as price rises failed to offset higher costs.
Source: Libstar
Source: Libstar

Consumer goods producers have lifted prices to cope with surging costs for raw materials, energy and packaging after Russia's invasion of Ukraine compounded pandemic-related supply chain logjams. But they face a challenge in how much they can raise prices without sacrificing sales as increasingly cost-conscious consumers trade down.

Normalised headline earnings per share from continuing operations fell to 65.3 cents from 74 cents a year earlier.

Price hikes helped the maker of Denny Mushrooms and Lancewood dairy products deliver revenue growth of 10.7% at R11.7bn in the year ended 31 December. Sales volumes rose 3% while pricing and mix changes contributed 7.7% to sales growth.

Products sold to the food service, industrial and contract manufacturing industries contributed strongly to revenue.

Cost of load shedding

Libstar's year-on-year gross profit margin declined to 20.7% from 22.2% reflecting higher costs in its main export-facing divisions and cost inflation in the rest of the portfolio.

Additionally, unprecedented levels of load shedding added R39m in direct operating costs, of which 70% related to three divisions: Lancewood, Denny Mushrooms and Finlar Fine Foods.

Source: Reuters

Reuters, the news and media division of Thomson Reuters, is the world's largest multimedia news provider, reaching billions of people worldwide every day.

Go to: https://www.reuters.com/

About Nqobile Dludla

Reporting by Nqobile Dludla; editing by Himani Sarkar and Jason Neely
Let's do Biz