Business / Companies
Innscor's expansion drive to continue
06 Sep 2012 at 12:02hrs | Views
Innscor Africa Limited is targeting to continue with its expansion drive for the coming year, Group CE Tom Brown told analysts this morning.
"We will continue to pursue the expansion drive which we have been doing since dollarisation and this will see a $50 million capital expenditure (capex) mainly in bakeries, fast foods, household goods and Colcom," Brown said as he gave a brief outlook for the group.
He also noted that they were targeting a 15% revenue growth for the year ending June 2013 as well as improving efficiency through leveraging on synergies within the group.
Group FD Julian Schonken had earlier on bemoaned the liquidity challenges in the marketing saying it affected operations during the group's strong periods.
"The liquidity crisis especially during October 2011 to January 2012 when the system was clogged did affect our operations adversely as it tallied with our traditional Q3 and Q4 which are normally our strongest quarters," Schonken added.
He also told the meeting that diminishing disposable incomes coupled by an increasing debt-trap in individuals had an adverse impact on the groups' performance.
"Utilities also had a significant impact on our cost structure due to the worsening of power and water supplies. We had to install generators at Irvines, Colcom and National Foods to deal with power issues. Water challenges also resurfaced during the period under review," the group FD told the meeting.
Schonken also admitted that the global grain shortage was another challenge the business faced citing the company required 22 000 tonnes of maize, 10 000 tonnes of wheat and 5 000 tonnes of soya per month.
Turning to the financial performance for the full year to June 2012, Schonken said revenue grew by 21% to $627 million whilst group EBITDA was 33% stronger at $68.53 mln.
"Ebitda margins grew by 100basis points to 10.1% driven mainly by improved efficiencies across the group," Schonken added.
Equity accounted earning s were up 23% to $7.56 million despite the disposal of a stake in National Foods with Schonken attributing strong performance by associates as the contributor.
PBT was 36% stronger at $61.3mln.
"The group registered a 46% growth in EPS to 7.15c but if you are to discount the National Foods disposal the growth will be 40% leading to the actual Headline EPS of 6.29c,"Julian told the gathering.
Innscor declared a final dividend of 1c which took its total dividend to 1.75c for the year, which is a 46% increase compared with prior year.
"The continuous improvement in efficiencies since dollarisation has seen a gradual uptrend growth in our operating profits since dollarisation, a position which we continue to anticipate going forward," he said.
He added that the group is on the right track "though we are not yet where we want to be."
Asked on the direction of bread price, CE Brown said they did not see any price increase from $1 a loaf albeit the wheat shortage in the country which he said was a global issue.
"We have a good pipeline of wheat in place at reasonable prices," Brown told the meeting.
"We will continue to pursue the expansion drive which we have been doing since dollarisation and this will see a $50 million capital expenditure (capex) mainly in bakeries, fast foods, household goods and Colcom," Brown said as he gave a brief outlook for the group.
He also noted that they were targeting a 15% revenue growth for the year ending June 2013 as well as improving efficiency through leveraging on synergies within the group.
Group FD Julian Schonken had earlier on bemoaned the liquidity challenges in the marketing saying it affected operations during the group's strong periods.
"The liquidity crisis especially during October 2011 to January 2012 when the system was clogged did affect our operations adversely as it tallied with our traditional Q3 and Q4 which are normally our strongest quarters," Schonken added.
He also told the meeting that diminishing disposable incomes coupled by an increasing debt-trap in individuals had an adverse impact on the groups' performance.
"Utilities also had a significant impact on our cost structure due to the worsening of power and water supplies. We had to install generators at Irvines, Colcom and National Foods to deal with power issues. Water challenges also resurfaced during the period under review," the group FD told the meeting.
Schonken also admitted that the global grain shortage was another challenge the business faced citing the company required 22 000 tonnes of maize, 10 000 tonnes of wheat and 5 000 tonnes of soya per month.
Turning to the financial performance for the full year to June 2012, Schonken said revenue grew by 21% to $627 million whilst group EBITDA was 33% stronger at $68.53 mln.
"Ebitda margins grew by 100basis points to 10.1% driven mainly by improved efficiencies across the group," Schonken added.
Equity accounted earning s were up 23% to $7.56 million despite the disposal of a stake in National Foods with Schonken attributing strong performance by associates as the contributor.
PBT was 36% stronger at $61.3mln.
"The group registered a 46% growth in EPS to 7.15c but if you are to discount the National Foods disposal the growth will be 40% leading to the actual Headline EPS of 6.29c,"Julian told the gathering.
Innscor declared a final dividend of 1c which took its total dividend to 1.75c for the year, which is a 46% increase compared with prior year.
"The continuous improvement in efficiencies since dollarisation has seen a gradual uptrend growth in our operating profits since dollarisation, a position which we continue to anticipate going forward," he said.
He added that the group is on the right track "though we are not yet where we want to be."
Asked on the direction of bread price, CE Brown said they did not see any price increase from $1 a loaf albeit the wheat shortage in the country which he said was a global issue.
"We have a good pipeline of wheat in place at reasonable prices," Brown told the meeting.
Source - Byo24News
