Food producer Libstar expects to report higher headline earnings at the interim stage, boosted by a resilient trading performance, improved profit margins and lower net finance costs.
The group, which is valued at almost R3bn on the JSE, expects to report total headline earnings per share (HEPS) of 13.4c-14.4c for the six months ended June, an increase of between 27.6% and 37.1%.
Normalised HEPS from continuing operations are expected to rise to 19.6c-21.4c from 18.4c a year ago — an increase of 6.5%- 16.3%.
The improvements are mainly attributable to a resilient trading performance by the Ambient Product subcategories of dry condiments, wet condiments and meal ingredients, it said.
Improved group gross profit margins of 21.7% compared with 21% a year ago arose from improved capacity utilisation, production efficiencies, pricing and cost management.
The group also reported a reduction in net finance costs due to lower average first-half net interest-bearing debt.
The difference between the expected growth in total HEPS and normalised HEPS is mainly attributable to after-tax unrealised foreign currency exchange gains of R5.5m, which are included in total HEPS but excluded from normalised HEPS.
The group expects to report first-half normalised Ebitda excluding unrealised foreign currency movements and other non-recurring, non-trading and non-cash items of between R445.1m and R456.9m. This represents an increase of between 12.4% and 15.4% compared to the prior year's R396.1m.
Its products include Lancewood, Denny Mushrooms, Goldcrest and Cape Herb & Spice.
The company, which exports its food products to more than 50 countries, will publish its results on September 10.
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