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TIGER BRANDS LIMITED - Tiger Brands unaudited group results and dividend declaration for the six months ended 31 March 2022

Release Date: 25/05/2022 07:05
Code(s): TBS     PDF:  
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Tiger Brands unaudited group  results and dividend declaration for the six months ended 31 March 2022

(Incorporated in the Republic of South Africa)
(Registration number 1944/017881/06)
Share code: TBS
ISIN: ZAE000071080
(“Tiger Brands” or the “Company”)


Tiger Brands delivers a subdued performance for the six months ended 31
March 2022 in an increasingly tough trading environment

Salient Features*
   - Revenue increased by 2% to R16.8 billion
   - Group operating income** decreased by 5% to R1.5 billion
   - Group operating margin** declined to 8.9% from 9.6%
   - EPS declined 3% to 733 cents per share
   - HEPS declined 2% to 729 cents per share
   - Interim Dividend unchanged at 320 cents per share
   - Share buy-back programme commenced
   - Venture Capital Fund makes inaugural investment in line with health and
      nutrition strategy

*From continuing operations
**Before impairments and non-operational items


Tiger Brands’ performance for the six months ended 31 March 2022 was impacted
by a particularly poor first quarter, driven by significant volume declines in Bakeries
and a protracted strike at Snacks and Treats. The poor performance of these
businesses was compounded by challenges relating to the procurement of certain
key raw materials and ingredients, as well as packaging availability and the inability
to effect sufficient price increases to offset unexpected cost push. The group’s
improved top line and profitability in the second quarter was insufficient to negate the
poor start to the year.

Total revenue from continuing operations increased by 2% to R16.8 billion, driven by
price inflation of 3% and partially offset by overall volume declines of 1%. Volume
growth in Exports and International was offset by volume declines in the Domestic
business, primarily attributable to Milling and Baking, Snacks and Treats as well as
Home and Personal Care. The volume declines were somewhat offset by a strong
volume recovery in Out of Home and good performances in Rice, Beverages and

Although cost saving initiatives and supply chain efficiencies have been accelerated
and are delivering ahead of plan, these were not enough to counter the high level of
input cost inflation, resulting in gross margin compression to 29.2% from 30.6% in
the corresponding period last year. Group operating income (before impairments and
non-operational items) decreased by 5% to R1.5 billion. Operating income for the
current period includes insurance proceeds of R17 million in respect of last year’s
product recall and R144 million in respect of the civil unrest which occurred in July

Earnings per share (EPS) from continuing operations decreased by 3% to 733 cents
(2021: 755 cents) whilst headline earnings per share (HEPS) from continuing
operations decreased by 2% to 729 cents (2021: 741 cents).

EPS from total operations decreased by 12% to 733 cents (2021: 837 cents) and
HEPS from total operations decreased by 2% to 729 cents (2021: 741 cents). The
significantly higher decrease in EPS from total operations for the six months ended
31 March 2022, relative to HEPS, is due to the inclusion in the prior period of capital
profits and foreign currency translation releases, amounting to R135 million, in
respect of discontinued operations.

Declaration of interim ordinary dividend
The Company has declared an interim ordinary dividend of 320 cents per share for
the six-months ended 31 March 2022, which is in line with the 2021 interim dividend.
In accordance with paragraphs 11.17 (a) (i) to (x) and 11.17 (c) of the JSE Listings
Requirements, the following additional information is disclosed:
   •   The ordinary dividend has been declared out of income reserves
   •   The local Dividends Tax rate is 20% (twenty percent) effective 22 February
   •   The gross total dividend amount of 320,00000 cents per ordinary share will be
       paid to shareholders who are exempt from the Dividends Tax
   •   The net total dividend amount of 256,00000 cents per ordinary share will be
       paid to shareholders who are liable for the Dividends Tax
   •   Tiger Brands has 185 655 000 ordinary shares in issue (which includes 10
       326 758 treasury shares)
   •   Tiger Brands Limited’s income tax reference number is 9325/110/71/7.

Shareholders are advised of the following dates in respect of the interim ordinary

 Declaration date                                         Wednesday, 25 May 2022
 Last day to trade cum the ordinary dividend              Tuesday, 28 June 2022

 Shares commence trading ex the ordinary dividend         Wednesday, 29 June 2022
 Record date to determine those shareholders              Friday, 1 July 2022
 entitled to the ordinary dividend
 Payment date in respect of the ordinary dividend         Monday, 4 July 2022

Share certificates may not be dematerialised or rematerialised between Wednesday,
29 June 2022 and Friday, 1 July 2022, both days inclusive.
The full impact of the global supply chain squeeze and related inflationary pressures
are being felt acutely in the level of cost increases being experienced. Procurement
positions are being exhausted and the recent weakening of the rand poses an
additional headwind.

The company will intensify its efforts to reduce costs and minimise selling price
increases through its various cost reduction and efficiency initiatives. Nevertheless,
significant price increases across most of the portfolio are inevitable. Inflation in the
second half is likely to run into double digits with the full impact of this on consumer
demand for our brands a key unknown. Balancing margin and volume will be a key
challenge over the next 12 months.

Although it is anticipated that profitability in the Bakeries segment is likely to remain
at current levels for the remainder of the year, the company as a whole is well
positioned to manage the challenges referred to above and grow period-on-period
operating income in the second half.

Any forward-looking information contained in this announcement has not been
reviewed or reported on by the Group’s auditors.

By order of the Board
GJ Fraser-Moleketi                                               NP Doyle
Chairman                                                         Chief Executive Officer


24 May 2022

Date of release: 25 May 2022

This short?form announcement is the responsibility of the Directors of the Company
and has not been reviewed or audited by the Group's auditors. The information
disclosed is only a summary of the full announcement and does not contain full or
complete details.
Any investment decisions should be based on the consideration of the Tiger Brands
interim results announcement ("Results"). The results were released on SENS on 25
May 2022 and are available on the Company's website and
Copies of the Results are available for inspection at the Company's registered office,
the offices of our sponsor or may be requested from the Company's investor
relations department during normal business hours and are available at no charge.
Registered office: 3010 William Nicol Drive, Bryanston, 2021
Independent non-executive directors: GJ Fraser-Moleketi (Chairman), MO Ajukwu,
FNJ Braeken, CH Fernandez, GA Klintworth, TE Mashilwane, M Sello, OM Weber,
DG Wilson
Executive directors: NP Doyle (Chief Executive Officer), DS Sita (Chief Financial
Secretary: JK Monaisa

J.P. Morgan Equities South Africa Proprietary Limited


Date: 25-05-2022 07:05:00
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