Advertise with fastmoving.co.za
 
 

Shares in Denny owner Libstar jump on maiden dividend.
Shares in Denny owner Libstar jump on maiden dividend.

Shares in Denny owner Libstar jump on maiden dividend

RETAILER NEWS

By Nick Hedley - Mar 13th, 13:49

Libstar, the consumer goods group that listed on the JSE in May 2018, announced a maiden cash dividend of 22c a share on Wednesday as profits after tax in 2018 edged 1% higher to R236m. 

The company’s shares were up as much as 9.7% at R7.79 in mid-morning trade.

The group, whose brands include Lancewood cheeses and Denny mushrooms, said the trading environment in the year ended December was “the toughest Libstar has experienced since its inception 14 years ago ... The retail sector is experiencing structural pressures brought about by economic uncertainty and lower levels of consumer spending”.

The group “performed satisfactorily”, with volume growth accelerating slightly in the second half of the year.

Revenues increased 12.5% to R9.9bn, thanks to acquisitions and the launch of Lancewood-branded dairy products.

Libstar said the local economy is expected to remain “sluggish” for the foreseeable future, “with a particularly difficult first half expected”.

Food inflation is likely to be between 0% and 2%, meaning growth will depend on volumes.

“The group aims, with product innovation, to grow its market share and the overall size of the market in terms of new products and new utilisation of products.”

Libstar aims to increase its penetration of independent retailers, wholesalers and exports. It will also invest further in plants and equipment, “and on specific earnings-enhancing capital projects” to boost output.

Its projects include the construction of a new tea plant for the local and export markets; a new Pringles plant to manufacture the snack for a third party; the expansion of its prepared-meal operations “to further tap into the growing convenience market”; and a new soft-cheese, value-adding and packing facility.

Independent analyst Anthony Clark said Libstar’s results were not as weak as expected, saying that on a 12- to 18-month outlook, Libstar is now “my cheapest buy in the sector”.
Business Live 

Related News

Tips for small business owners to survive load-shedding
20/03/2019 - 09:36
With small businesses already dealing with hikes in VAT and petrol, coupled with decreased consumer spending, load-shedding is a bridge too far, particularly for restaurateurs.

Asos sales up 13% as UK market outperforms
20/03/2019 - 09:25
Asos has reported a rise in its quarterly sales, as growth at home in the UK continues to outperform its foreign markets.

Sainsbury’s and Asda seek to salvage deal with £1bn pledge
20/03/2019 - 08:58
British supermarket groups Sainsbury’s and Asda have committed to deliver £1bn of annual price cuts as they attempt to salvage their proposed combination after being dealt a potentially fatal blow by the regulator.

Is #BlackFriday affecting SA’s December retail trade?
19/03/2019 - 09:37
South Africa has seen the Black Friday sales phenomenon grow exponentially in recent years, quickly entrenching itself as a major calendar event on the local retail and shopping scene. The Black Friday sales bonanza, which takes place towards the end of November, is now bigger in SA than ever before. It is a boon for retailers, shopping centres and consumers. However, is Black Friday an emerging threat for the traditional December festive season sales boom?

Shoprite Group helps waiter become an entrepreneur thanks to his unique product offering
18/03/2019 - 15:02
Phenyo Sebaeng (28) had to borrow money from two of his close friends in order to buy a bus ticket from Rustenburg to Cape Town, where he had secured a meeting with a buyer at the Shoprite Group's home office in January 2017.