The following disclosure is made in accordance with Section 3.4 (b) of the Listings Requirements of the JSE Limited. Pioneer Foods advises that for the year ended 30 September 2018, a reasonable degree of certainty exists that operating profit and earnings will be as follows:
|30 September 2017 actual||30 September 2018 expected range||30 September 2018 expected % change|
|Revenue||R19 575 million||R19 868 million - R20 456 million||1.5% - 4.5% higher|
|Operating profit before items of a capital nature||R1 156 million||R1 549 million - R1 665 million||34% - 44% higher|
|Adjusted operating profit before items of a capital nature (note 1)||R1 276 million||R1 570 million - R1 698 million||23% - 33% higher|
|Headline earnings per share||410.1 cents||541.3 cents - 582.3 cents||32% - 42% higher|
|Adjusted headline earnings per share (note 1)||442.2 cents||548.3 cents - 592.5 cents||24% - 34% higher|
|Earnings per share||390.3 cents||573.7 cents - 612.8 cents||47% - 57% higher|
- Adjusted for the IFRS 2 share-based payment charge relating to the Phase 1 (2006) B-BBEE transaction and the effect of the related hedge. An adjustment was also made in September 2017 for specific once-off merger and acquisition costs (R17.6 million).
Pioneer Foods delivered positive revenue and volume growth from existing and acquired businesses at supportive price points whilst maintaining cost discipline. The consequent procurement benefits and efficiency gains enhanced operating profit over a weak corresponding period. Overall revenue growth was positive notwithstanding the material soft commodity deflation during the period.
Trading conditions continue to reflect a constrained demand environment as consumers are faced with increased inflationary pressures. This was more prevalent in the second half as rising input costs were exacerbated by the weakening exchange rate and persistent oil price increases. Increasing competitor tensions, weaker consumer demand and the resultant inability to fully recover input cost inflation characterises the current trading environment.
Pioneer Foods is due to release its full year results for the year ended 30 September 2018 on or about 19 November 2018.
The financial information contained in this trading update, has not been reviewed or reported on by the Group’s external auditors.