Clover shares dip, but prospects are pos­i­tive

The Star Early Edition - - COMPANIES - Ka­belo Khu­malo

CLOVER In­dus­tries’ share price got bat­tered yesterday on the JSE with its shares nose­div­ing 7 per­cent af­ter the com­pany re­ported unin­spir­ing trade up­date re­sults for the six months ended De­cem­ber, with fes­tive pe­riod per­for­mance adding to the group’s woes.

How­ever, the group said it had pinned its turn­around hopes on the re­struc­tur­ing process the com­pany had em­barked on.

All the firm’s cat­e­gories, with the ex­cep­tion of UHT and fer­mented prod­ucts, re­ported lower vol­umes than in the com­par­a­tive six months.

It at­trib­uted this to neg­a­tive con­sumer sen­ti­ment and wet and cooler sum­mer con­di­tions com­pared with the heat wave in the com­par­a­tive pe­riod.

Clover said yesterday in its up­date state­ment that its De­cem­ber vol­umes had tracked markedly lower than the com­par­a­tive pe­riod.

It had ex­pected its headline earn­ings for the six months ended De­cem­ber to be be­tween 14.6 per­cent and 24.6 per­cent lower and earn­ings to be be­tween 12.1 per­cent and 22.1 per­cent lower than in the com­par­a­tive pe­riod.

Headline earn­ings a share for the pe­riod un­der re­view were an­tic­i­pated to be be­tween 18.33c and 30.02c lower than the 116.96c re­ported in the cor­re­spond­ing pe­riod. Earn­ings a share were ex­pected to be be­tween 15.36c and 26.96c lower than the 116.07c re­ported in the com­par­a­tive pe­riod.

The com­pany said it had also in­curred losses in implementing its re­struc­tur­ing strategy, but re­mained con­fi­dent it would pay div­i­dends.

“Once-off re­struc­tur­ing costs re­lated to the in­te­gra­tion of the com­pany’s City Deep dis­tri­bu­tion fa­cil­ity into the Clayville dis­tri­bu­tion fa­cil­ity,” the com­pany said.

Clover shares closed the day 6.62 per­cent down at R17.50.

PHOTO: SIM­PHIWE MBOKAZI

Clover takes a knock but group up­beat over re­struc­tur­ing.

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