Advertise with fastmoving.co.za
 
 

Strikes, a shrinking market and aggressive competition in the snacks and treats sector were among the reasons Tiger Brands gave for flat sales and lower profits for its 2017 financial year.
Strikes, a shrinking market and aggressive competition in the snacks and treats sector were among the reasons Tiger Brands gave for flat sales and lower profits for its 2017 financial year.

Tiger Brands hit by strikes and tough market conditions

RETAILER NEWS

By Robert Laing - Nov 27th 2017, 09:07

Strikes, a shrinking market and aggressive competition in the snacks and treats sector were among the reasons Tiger Brands gave for flat sales and lower profits for its 2017 financial year. 

The fast-moving consumer goods group reported on Monday morning that revenue grew 2.3% to R31.3bn while net profit declined 5.5% to R3bn during the year to end-September.

Tiger Brands maintained its final dividend level at R7.02 per share. Since it raised its interim dividend to R3.78 from R3.63, its total dividend for the year of R10.80 was 1.4% higher than the prior year’s R10.65.

Revenue from the group’s domestic operations grew 3.6% to R27bn, representing 85% of the group’s total.

Its exports and international divisions suffered a 5.4% decline in revenue to R4.2bn.

Tiger Brands said its deciduous fruit exports suffered from a stronger rand, resulting in its operating income crashing 91% to R13.2m from R147.6m.

Falling grain prices helped the group grow its bread sales.

Tiger Brands said its beverages division suffered from industrial action, drought-related water restrictions and electricity disruptions in the first six months.

The second-half recovery was insufficient to offset the difficult start to the year. Revenue declined by 9% to R1.2bn, while operating income reduced by 8% to R144m.

"The outlook for this business is encouraging with the launch of Oros ready-to-drink gaining momentum," the results statement said.

Its snacks and treats division suffered a 5% revenue decline to R2.2bn due to "industrial action, a contracting market, aggressive competition and a product rationalisation exercise".

"However, an improvement in gross margins resulted in operating income increasing marginally to R324m."

"The new Heavenly aerated chocolate slabs were launched in the second half of the year and were well received by both consumers and customers."

"Snacks and treats will focus on volume recovery in the year ahead."
© BusinessLIVE MMXVII 

Read more about: tiger brands | sales | retail | fmcg

Related News

Checkers brings world-class retail to Constantia with new flagship store
27/11/2019 - 13:01
Checkers has opened the doors to its state-of-the-art 2 330 m² flagship supermarket at the Constantia Emporium as the retailer continues to take innovation to new heights.

Woolworths carves out market share in SA
27/11/2019 - 10:11
In Australia, David Jones's sales declined 2.1%, with the company saying a store refurbishment contributed to the decline.

Push and pull strategies work together to keep consumers coming back for more
26/11/2019 - 10:20
The retail sector is under increasing pressure as consumers have shrinking disposable income in a strained economy. Maintaining share of wallet is critical. Relying solely on a push route to market strategy from manufacturers into retailers is not enough to get consumers buying products. A pull strategy needs to coexist with the push to drive brand consumption. Integrating these strategies requires intelligent and insightful decision-making. This, in turn, requires data generated through smart technology which provides line of sight across the value chain from manufacturer to distribution, retailer to the consumer.

Exclusive leases must fall: Commission cracks whip on Shoprite, Pick n pay, Spar, Woolies
26/11/2019 - 09:57
The Competition Commission Inquiry into Grocery Retail, published on Monday, called for an end to the exclusive leases negotiated by national retail chains in all shopping malls across the country in a bid to open up access to markets for smaller players.

Tiger Brands still reeling from listeriosis aftershock
26/11/2019 - 09:41
Tiger Brands continued to feel the effects of the listeriosis outbreak in the year to the end of September after the food producer suffered an impairment charge in its value-added meat products (Vamp), following a slower-than-anticipated recovery in the division.