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SA's largest food producer, Tiger Brands, has delivered a double-digit dividend increase with full-year net profit rising by just over half, even as it battled a high inflation environment with consumers under pressure.
The firm said on Friday it was able to raise selling prices by 11% in its 2022 year although it did experience a slight dip in volumes in its domestic business.
Tiger, which owns brands such as Jungle Oats, Tastic rice and Albany bread, reported on Friday that its profit for the year to end September was R2.85 billion, up almost R1 billion. It declared a full year dividend to shareholders of 973c, an 18% increase over the previous year, and representing about a R1.75 billion payout. Its final dividend came in 29% higher at 653 cents.
Tiger said it had "delivered a credible set of results despite tough trading conditions and significant input cost inflation", adding that the year under review could be described as a "year of two halves".
It said its first half was affected by a delay in recovering "unprecedented and unanticipated levels of cost inflation" and that this was "compounded by certain supply constraints" due to global and local supply chain crunches, as well as industrial action at its Snacks & Treats and Bakeries division.
"The second half performance, despite a continuation of the cost and supply challenges, exacerbated by prolonged periods of load shedding, reflects the effective implementation of category specific margin recovery initiatives, as well as the execution of category specific initiatives in Bakeries, Snacks & Treats, and Exports (divisions)."
The company said that total revenue from continuing operations increased by 10% to R34 billion, driven by price inflation of 11% and a "marginal overall volume decline of 1%".
"Volume growth in Exports and International (divisions) was offset by volume declines in the Domestic Business, primarily attributable to Milling and Baking, Snacks & Treats, Baby, as well as Home and Personal Care."
Tiger said these volume declines were partially offset by good volume growth in rice, beverages, groceries and out-of-home categories.
The group also struck a cautious note in its outlook, saying that the year ahead was "likely to remain challenging" with high interest rates, unemployment and inflation expected to continue hurting cash-strapped consumers.
Tiger's shares were up 2.46% to R193.97, having risen 4.25% so far in 2022. Click here for details on Tiger's shares and more info.
