Tiger Brands, South Africa’s biggest
consumer foods manufacturer, reported flat first-half earnings on
Wednesday, weighed down by its operations in Nigeria.
Tiger Brands, which makes cereal, energy
drinks, pasta and rice, said diluted headline earnings per share fell
by 1 percent to 837 cents in the six months ended March. Headline
earnings per share is the main profit gauge in South Africa that strips
out certain one-off items.
Sales rose 7 percent to 15.9 billion rand ($1.3 billion).
The company incurred significant foreign
exchange losses in Nigeria, where its struggling Dangote Flour Mills
business was hit by a 25 percent devaluation in the naira, partly
related to the impact of lower global crude oil prices.
But Dangote Flour Mill’s underlying
trading performance was healthy, which resulted in a 38 percent
reduction in its trading losses, excluding currency effects.
The company wrote down the value of its
Nigerian arm by 849 million rand in May last year and by another 105
million in November.
It said further foreign exchange losses
could hit its Nigerian business in the second half of the year. The full
inflationary impact of the weaker naira is yet to be felt by consumers
in the country, Tiger Brands said.
In Kenya, its Haco business was hit by
pre-invoicing to manipulate profit in the previous year, the company
said. Tiger Brands said it had taken steps to correct this.
No comments:
Post a Comment