JSE-listed food and packaged goods company Tiger Brands increased revenue by 10% to R37.4-billion, driven by price inflation of 11%, favourable foreign exchange gains of 1% and marginal overall volume declines of 2% for the financial year ended September 30.

Volume growth in exports was offset by volume declines in the domestic business, primarily attributable to milling and baking, groceries and baby, as well as the deciduous fruit business owing to the timing of shipments.

These volume declines were partially offset by good volume growth in rice, beverages, home and personal care, Tiger Brands food service solutions, as well as Chococam.

The results reflect the challenging trading environment marked by high food inflation, cost-conscious consumers continuing to trade out of premium products, rand depreciation and unreliable electricity supply, the company said.

Further, cost containment initiatives and supply chain efficiencies continued to make a positive contribution to the results at R525-million, which is R65-million higher than the R460-million previously guided.

"Despite this, the ongoing challenges of fully recovering higher input costs persisted in the second half, resulting in the overall gross margin declining to 27.7% from the 30.3% reported in the prior year.

"Group operating income was impacted by non-recurring items related to insurance proceeds of R137-million, up from R190-million in the 2022 financial year, and retrenchment costs in the current year of R95-million, compared to a reversal of R8-million in the prior financial year, resulting in a decline of 9% of operating income to R3.1-billion," the company said in a statement.

Earnings a share decreased by 2% to R17.25, compared to R17.62 in the 2022 financial year. Headline earnings a share increased marginally by 2% to R17.3, up from R17.02 in the prior financial year.

The variation in earnings a share compared to headline earnings a share is owing to the non-recurrence of certain capital profit items accounted for in earnings a share in the 2022 financial year, which were excluded from headline earnings a share, the company said.

Tiger Brands declared a final ordinary dividend of 671c a share, in line with its dividend policy of 1.75-times cover based on headline earnings a share. With the interim dividend of 320c a share, this brings the total dividend for the year to 991c a share.

Additionally, net financing costs for the year amounted to R238-million, up from to R75-million in the prior financial year, owing to higher interest rates, the impact on opening cash balances of the R1.5-billion share buyback, which concluded in August 2022, and higher average levels of working capital investment despite progress being made in managing these levels down in the second half of the financial year, Tiger Brands said.

Income from Tiger Brands' associates increased by 46% to R697-million, driven by a good underlying performance from Carozzi.

Earnings from National Foods were favourably impacted by R120-million owing to a change in functional currency from Zimbabwean dollars to US dollars, as a consequence of listing on the Victoria Falls Stock Exchange in January 2022.

The group's effective tax rate before fair value losses, non-operational items and income from associates declined slightly to 29.0% from 29.4% in the 2022 financial year.

APPOINTMENTS
Tiger Brands has appointed Thushen Govender as CFO and executive director with effect from January 1, following the resignation of Deepa Sita.

In his role as CFO, Govender will have oversight of finance, information technology, procurement as well as customer service and logistics functions, the company said.

Govender is a chartered accountant and registered member of the South African Institute of Chartered Accountants with an MBA from Henley Management College.

He has a record within Tiger Brands and is a seasoned fast-moving consumer goods executive with leadership experience across various geographies. He re-joined Tiger Brands in 2021 from Aspen Holdings, where he was Group commercial officer for international markets including Russia, US and China.

Prior to this, he played a pivotal role in developing the international strategy for Pioneer Foods, with direct responsibility for the global exports business as well as the UK and Africa operations, having delivered growth in competitive markets such as North America, Asia, Africa and Europe.

As executive chairman of the Pioneer Foods UK Business, he spearheaded the organic and inorganic expansion strategy in Western Europe. Additionally, Govender served on the boards of Bokomo Botswana, Bokomo Namibia and Weetabix East Africa on behalf of Pioneer Foods.

Further, during his previous tenure at Tiger Brands, Govender was primarily responsible for the development and execution of Tiger Brands' growth strategy at the time having held the executive position of group strategy, investor relations and business development.