AVI’s annual headline earnings return to pre-pandemic levels
FOR THE YEAR ended June 30, 2022, the group said its headline earnings per share increased by 6.1 percent to 530.6 cents compared to 499.9c last year.
Group revenue increased by 4.3 percent and was supported by a combination of improved sales volumes in key categories and price increases to ameliorate significant cost pressures.
The board declared a final ordinary dividend of 292c per share, resulting in a full-year ordinary dividend of 462c, which was 6.2 percent higher than last year, and in line with the growth in headline earnings, the group said.
“The group’s performance in the first semester was disrupted by the civil unrest in July 2021, with all of our facilities and retail stores closed to safeguard our staff.
“Direct losses amounted to R38.1 million, asset and trading losses were insured and R69.7m was received and recognised in the year. The impact of rising commodity prices and the sharp increase in the cost of fossil fuel and other commodities intensified in the second semester,” AVI said.
The food and beverage brands made up most of the revenues totalling 80.6 percent, and fashion brands brought in the rest.
Snackworks, whose brands include Bakers and Provita, achieved 33.96 percent of their revenue, while Entyce Beverages, which produces Five Roses and Freshpak gained 28.76 percent in revenue.
I&J’s revenue of R2.47 billion was 5.1 percent lower than last year while operating profit decreased from R341.6m to R307m. The operating profit margin declined from 13.1 percent to 12.4 percent.
In its personal care segment, Indigo’s revenue of R1.18bn was 2 percent higher than last year, primarily due to selling price increases taken in response to rising input costs, partly offset by the impact of lower volumes.
Operating profit increased from R170.4m to R193.4m, with the operating profit margin increasing from 14.8 percent to 16.4 percent.
In the Footwear and Apparel segment, including Spitz, Green Cross, and Gant, revenue increased by 3.1 percent to R1.51bn mainly due to higher selling prices and an improved sales mix, partially offset by lower sales volumes.
Operating profit improved from R230.4m to R302.5m, with the operating profit margin increasing from 15.7 to 20 percent.
Looking forward, the group said its financial prospects depended on how the domestic economy performs in the next year.
“Ongoing disruptions to global supply chains, domestic and international inflationary pressures, and the prevalence of load shedding are likely to persist, and while the group is operationally geared to manage the challenges, there are costs to doing so.
“Of equal importance is the impact these factors may have on our consumers. Real incomes continue to decline, and unemployment remains high, especially for younger South Africans,” AVI said.