On a mission to beef up Gauteng customer base

CEO Nick Serfontein said half of the company's earnings came from processed meat, which was cheaper than other meat cuts. As a result, the company was not expecting to be as hard hit by rising interest rates as it served the lower end of the market.

The group was expanding capacity at the Empangeni plant, which was almost on stream, by 60%. It was also seeking to invest in processing capacity in Gauteng and had agreed to share a distribution centre in Midrand in order to capture more of the Gauteng market. It was already selling to a handful of Checkers outlets, but wanted to expand into Pick n Pay, Shoprite and other retailers.

The additional plant and equipment that was being installed would take output from 26 tons of processed meats a day to 42 tons.

Serfontein said this should help the group show a marked increase in turnover in the coming financial year.

The company has also started to recruit and train additional sales and marketing staff.

Plans delayed

Serfontein said the expansion plans were delayed by about two months as its listing, which took place in January, was later than expected. However, he was confident the company would do well at year-end despite these delays.

In the future, the company would contemplate ownership of a feedlot because of its cash generative capabilities, he said.

This week Best Cut, which is moving its listing from the Development Capital Market to the JSE's Alternative Exchange, said it had beaten its projected profit forecast in the six months to January by 3%.

The company's figures, which included trading figures for only three months as the company had been a cash shell prior to making acquisitions in October, were not directly comparable with the prior period.

It reported revenue of R39,4m and an operating profit of R6,4m.

Source: Business Day

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