Pioneer Foods FY profit rises, sees muted growth

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JOHANNESBURG – South Africa’s Pioneer Foods Group posted a 27 percent jump in full-year profit boosted by higher volumes and growth in revenue.

The food and beverage company, which uses maize in many of its food products, said the milling and baking segments of Essential Foods business were under pressure in the second half of the year due to increased competition, consumer down-trading and increased cost pressure due to a weakening currency.

“Pioneer Foods delivered positive volume and revenue growth at supportive price points whilst maintaining cost discipline and efficiency gains to improve margin and earnings delivery over the weak corresponding period,” Pioneer said in a statement.

The food producer said it expects muted consumption growth in the short to medium future on the back of inflationary pressure, driven by continuing rand weakness and higher international oil prices.

Diluted adjusted headline earnings per share (HEPS) for the year ended Sept. 30 rose to 525.7 cents from 414.6 cents a year earlier, when the firm was hit by high maize prices following a severe drought, it said.

HEPS is the main profit measure used in South Africa which strips out certain one-off items.

Revenue for the period increased by 3 percent to 20.2 billion rand.

The firm declared a gross final dividend of 260 cents per share compared with 260 cents in the year-ago period. (Reuters)