The fast-moving consumer goods (FMCG) company, whose brands include Sasko, Bokomo Foods, Quantum Foods and the Ceres beverages company, also indicated that its earnings per share is expected to increase by between 80 per cent and 95 per cent.
“Earnings growth benefitted from value enhancement initiatives and the continued focus on cost reduction and efficiencies. In addition, a strong volume performance from the international business resulted in increased profitability, aided by rand weakness,” [DATA PFG:Pioneer Foods Limited] said.
The company recently indicated its intention to unbundle its Quantum Foods business and list it separately on the Johannesburg Stock Exchange (JSE) in 2014.
(READ MORE: Astral enters into supply agreement with Quantum)
As a result, Quantum Foods, which specialises in poultry, is expected to be treated as ‘an asset held for sale’ and a ‘discontinued operation’ going forward.
“To provide a consistent perspective on the operational performance from continuing operations, an adjustment is made for the impact of the Phase 1 BEE transaction in the respective reporting periods and the treatment of Quantum Foods as a discontinued operation,” it said.
“The net assets of Quantum Foods have to be valued at the lower of the carrying amount or fair value less cost to sell as at the reporting date. An independent valuation resulted in a further impairment of 54 million rand to the consolidated net asset value of Quantum Foods, reflecting the continuing challenges in the broiler industry.”
(READ MORE: Pioneer Foods sees 9% FY revenue growth)
Pioneer Food’s interim financial results for the six months ending 31 March 2014 is expected to be announced on or around 19 May 2014.