Clover pulls back in Nigeria as oil rout takes toll
bdlive.co.za - Mar 2nd 2016, 09:15
Dairy producer Clover cited solid festive season demand in its home market for an uptick in interim earnings, but warned of risks elsewhere in Africa and said it would make no more investments in Nigeria.
"The severe heat wave conditions towards the end of the reporting period resulted in an exceptional performance by the beverage portfolio," the company said.
In the six months to 31 December, headline earnings per share (HEPS) rose 7.1% from a year earlier to 117c, operating profit grew 5.8% to R340.3m, and revenue climbed 7.9% to R5bn.
Clover declared an interim dividend of 24.2c per share, 7.1% higher than the previous year.
The beverage maker said the weakened global economy posed a significant risk to the company’s business in Africa.
"The current financial crisis experienced in Nigeria, which is fuelled by the low oil price, is a further cause of concern, thus the group has decided to withdraw from future investments in Nigeria," it said.
"The group will continue to expand its operations within the Botswana, Namibia, Lesotho, and Swaziland region, and will continue to pursue export opportunities in Africa, where the currency risks can be mitigated.
"The capital previously earmarked for Africa will no longer be spent."From DFM Publishers (Pty) Ltd
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