Tiger Brands Ltd. (TBS), South Africa’s biggest food maker by market value, said the company regained volume in bakeries, rice and snacks and treats and maintained profit margins across many of its domestic businesses.
Net income for the six months through March increased 2.6 percent to 1.32 billion rand ($135 million), compared with 1.28 billion rand a year earlier, the Johannesburg-based company said in a statement today. Sales advanced 21 percent to 14 billion rand.
“The on-going economic pressures, resultant constraints on consumer spending and increased competitive intensity in the domestic market provide an appropriate context for these results,” the company said.
Tiger Brands, South Africa’s biggest processor of grains and the maker of Albany bread, is expanding in Africa to reduce exposure to its domestic market, which grew by 0.9 percent in the first quarter, less than the most pessimistic forecast of 15 economists in a Bloomberg survey. The company bought Dangote Flour Mills in Nigeria for about $200 million last year as acquisition opportunities dwindled at home.
“In the short term, volatility in soft commodity prices and foreign currency movements is likely to persist, exacerbating a tough trading environment,” it said.
Tiger Brands shares have declined 11 percent this year, compared with a 25 percent gain for Pioneer Foods Ltd. (PFG), the second-largest food company by market capitalization. The stock fell 2.9 percent to 289.25 rand by the close yesterday in Johannesburg, valuing the company at 55.4 billion rand.
The company said interim dividends for the six months rose 5.1 percent to 3.10 rand.
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