Innscor earnings up 48 percent

Group revenue came in at US$627 million compared to US$516 million over last year’s comparative period.
Profit after tax for the period under review stood at US$48,5 million from US$32,7 million in the prior period.

“The group performed to expectation during the course of the 2012 financial year, posting another set of solid results with good revenue growth and efficiency at earnings level,” Innscor chairman Mr David Morgan said.

The strong financial performance in the financial year to June 2012 resulted in directors declaring a US1c final dividend to take the dividend for the year to US1,75c.
Volumes in the bakeries division increased by 53 percent largely driven by a third new line in the Harare plant, which was commissioned in November last year.
Customer accounts in the fast foods business unit, which also falls under bakeries, grew by 11 percent in Zimbabwe and 11 percent in the region.
Mr Morgan said Distribution Group Africa’s Zimbabwe operations delivered a solid set of results underpinned by a 20 percent growth in volumes in the period.

But the division registered a 10 percent growth in Zambia on the back of growth in the formal retail market.
The Spar Corporate Store retail operations posted a trading loss of US$830 000 on the back of costs incurred with regard to rationalisation through closures of small stores.

The network now consists of six units and management is confident this now creates basis for profitability.
While the Spar Distribution Centre in Harare registered a 16 percent growth in volumes during the year reduced margins resulted in a negligible profit increase.
Pork processor Colcom registered a 31 percent increase in volumes riding on new low-cost mass-market product with low margins hence limited overall profit.

Household goods supplier TV Sales & Home, said Mr Morgan, achieved a 30 percent growth in volumes and plans are underway to identify potential sites for new outlets.

Positive results were also achieved in Capri, which saw volumes increase by 49 percent as efficiencies improved on the back of growing demand for its products.
This growth has set the tone for a capital expansion plant that will see a new refrigerator plant being commissioned in the fourth quarter of the 2013 financial year.
In the associated business segment 37 percent owned National Foods posted pleasing results after overall volumes increased by 15 percent to 404 metric tonnes.

Increased capacity utilisation at Natfoods and further investment in plant and core equipment improved profitability.
Another associate, Irvine’s, saw volumes grow by 14 percent in processed chicken, 19 percent in day- old chick sales and 7 percent volume growth in table eggs.

Expectations are that additional investment in hatching capacity would result in output growth in the 2013 financial year.
Shearwater, said Innscor, continued to contribute positively to the group while Natpak, the block-bottom bag production unit, has not achieved optimum production targets and recorded a loss over the past year.

Innscor expects to continue generating cash in the period ahead in which most of the funding will be channelled to expansion.