Quantum Foods upbeat despite decline

QUANTUM Foods yesterday pointed to the drought and the volatile rand as it recorded a 48percent decline in headline earnings, from R126 million to R66m, for the year to the end of September.

The South African chicken company, spun off from Pioneer Foods in 2014, remains upbeat about the future despite the past financial year being “very challenging for the poultry industry”. Quantum said the drought and volatile rand had led to “dramatic” increases in the cost of raw materials. Added to the strained consumer environment this had created unfavourable trading conditions in South Africa, it said, adding similar headwinds had impacted operations in the rest of Africa.

Group revenue had increased by 12.8percent to R3.9billion, with an increase of 14.1 percent (R463.7m) in South African operations and a decrease of 10.5percent (R18.9m) in other African operations.

Revenue from other African operations contributed 4.1 percent of group revenue, down from 5.2percent last year. Headline earnings per share came in at 28 cents, down from 54 cents a year before, and a final dividend of 6 cents per share was declared, down from 10 cents.

Quantum said: “Despite this, we believe this current situation will turn around and that the group is well positioned to gain benefits from the recent investments in Zambia, Uganda and Mozambique.” – ANA