Quantum Foods shakes off bird flu


Quantum Foods shakes off bird flu

Published Date: 2017-10-20 | Source: Stephen Gunnion | Author: Stephen Gunnion

Quantum Foods shakes off bird flu

The poultry producer has flagged a sharp rise in earnings despite the cost of Avian Influenza

Quantum Foods says the recent record maize crop and a relatively stronger rand have led to lower feed costs for its chickens. That and higher selling prices helped improve margins in its eggs business, while external sales volumes increased in its feeds business, helped by a full-year contribution from the Olifantkop feed mill. Trading conditions at its other African businesses have also improved.

Despite a R30 million charge for the value of layer hens destroyed and the associated clean-up costs following the recent outbreak of Avian Influenza at its Western Cape farms, Quantum still expects a big leap in full-year earnings.

Related article: Avian flu continues to ruffle feathers at Quantum

In a trading statement yesterday, it said headline earnings per share for the year to end September were likely to be 65% to 85% higher, while earnings per share would be up by between 33% and 53%. Profit from the sale of a dormant Western Cape abattoir and a property in Oudtshoorn also not core to the Groups operations are included in the expected earnings per share number. Profit from the sale of its Hartbeespoort abattoir amounting to 11c per share was included in last year's earnings.

Last month Quantum confirmed an outbreak of highly pathogenic avian influenza at two of its commercial layer farms in the Western Cape. Although the outbreak was only confirmed at two layer houses, it decided to depopulate the two sites entirely as a preventative measure. It said 9% of the group's current national table egg supply was affected by the outbreak, which occurred despite stringent bio-security measures in place at all its farms.

Quantum's shares rallied 13.5% yesterday to end trade at R3.28.

Similar Stories