Libstar pays maiden dividend after tough year


Libstar pays maiden dividend after tough year

Published Date: 2019-03-14 | Source: Stephen Gunnion | Author: Stephen Gunnion | Comments

Libstar pays maiden dividend after tough year

The branded consumer goods group says last year was the toughest yet but it has a very clear growth strategy.

Libstar says the retail and consumer environment last year was the toughest it's experienced in its 14-year history. Still, the branded consumer goods group has produced a maiden dividend after it was listed on the JSE by parent company Abraaj Group last May.

It says the retail sector is experiencing structural pressures due to economic uncertainty and declining consumer spending. It still managed to grow revenue for the year as volume growth in the first half of the year accelerated slightly in the second half. Revenue was also supported by the successful launch of new dairy products under its Lancewood label.

Libstar makes and supplies consumer packaged goods for local and global consumption, including perishables, groceries, baking goods, snacks and sweets, beverages and home and personal care products. Brands include Amaro Foods, Ambassador Foods, Denny Mushrooms, Finlar and Montagu Foods. The company also represents global brands including Kiri, Arla, Bel, Laughing Cow, Act II, Lurpak, Tabasco, Kikkoman and Maille.

Revenue increased by 12.5% to R9.89 billion in the year to end-December, with organic revenue up by 5.1%. Normalised earnings before interest, tax, depreciation, and amortisation rose 4.6% to R984 million and profit after tax was 1.1% higher at R236 million. Normalised heading earnings per share fell 16.1% to 73c due to a R42 million impairment as its restructured its Niche Beverages business. It's lowered its net debt to R1.2 billion from R1.9 billion and has declared a maiden cash dividend of 22c per share.

Its shares rose 10.3% to R7.83 yesterday.

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