Pioneer Foods' headline earnings decine
2008-12-04
PIONEER FOODS has announced a revenue figure of R14,9 billion for the past financial year (up 27%). Operating profit (before items of a capital nature) was R865 million (up 4%), while headline earnings per ordinary share was down 11% to 292 cents. The dividend per ordinary share is 96c (up 3%). Says MD André Hanekom: “The year under review was characterised by significant pressure on key operating costs and volatile commodity prices in a challenging operating environment where the consumer’s discretionary income became more constrained. “We managed to achieve good volume growth in key product categories and increased final product prices, but failed to fully recover steeply rising input costs as indicated by our declining profit margin. “Headline earnings declined mainly as a result of significantly higher finance costs to fund increased fixed and working capital spend. We are confident in the inherent strength of our product basket and its development potential to expect margins to improve over time, as operating costs stabilise and inflation subsides.”
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