A devastating year indeed

This has been a truly challenging year for Tiger Brands, with hiccups across the board and one genuine catastrophe to define the period. The major external issue to impact the company was the woeful state of consumer spending, with SA slipping into a technical recession in the second quarter and the weakening rand placing ever greater pressure on the consumer’s wallet. This combined with significant increases in input prices to produce a toxic cocktail that would knock the froth off any large consumer-facing operation.

The catastrophe, of course, was the listeriosis outbreak, and Tiger correctly points out that while this was devastating for the company, the impact was far more severe on the affected families. Tiger has pledged R10m to set up a centre for food-safety in conjunction with Stellenbosch University, to undertake research to help the industry, the government and the consumer to understand food-safety issues, and to do what it can to ensure that such a tragedy doesn’t happen again. A class action on behalf of the victims is being finalised, and while Tiger has product liability insurance cover, it could still prove expensive.

The company expects 2019 to remain challenging, with no sign of any bounce in economic growth or consumer confidence. It is looking to build foundations for future growth by boosting its executive leadership team, improving internal processes to further the execution of its strategy, and by implementing the group’s Africa strategy. It won’t be a quick recovery, but hopefully there will never be another year like 2018.