Innscor posts 51pc profit after tax

30 2011 driven by better efficiencies, strong volume and revenue growth.
Revenue increased by 28 percent to US$516 million while profit after tax increased to US$32,7 million from US$21,6 million the prior year.

Innscor said volumes rose 67 percent on the prior year due to significant recapitalisation, which has raised capacity utilisation, better efficiencies, better quality and new bread varieties.
The strong growth in volumes, revenue and profitability lifted basic earnings per share by 65 percent to US4,82c leading to a US1,2c dividend.
“The group continued to show good progress during 2011, with volume growth across most businesses giving rise to improved revenues, this revenue growth together with better efficiencies and cost control resulted in improved profitability,” said Innscor.

Its milling and manufacturing division comprising Innscor Bread, Colcom, WRS, Capri, Innscor Snack Foods, Natfoods (associate), Irvine’s Zimbabwe and Natpak contributed US$132 million revenue.
The group’s retail division – made up of Fast Foods Spar Corporate Stores, TV Sales and Home – reported revenue of US$175 million and before tax profit of US$8 million during the period.
In the wholesale and distribution division revenue amounted to US$97 million with before tax profit totalling US$4 million in the full year. The group divested from the transport business in the last half of the year.

On the regional front Innscor, which operates the Spar Corporate Stores as the main business in Zambia, posted full-year revenue of US$68,28 million. The division has distribution operations in Zambia and Malawi and saw strong volume and revenue growth.
Innscor seeks to tap further into the growing in the Zambia market and has made investment in expanding its warehousing by 30 percent.

Regional fast foods operations consists of counters in Zambia, Kenya, Ghana, Senegal and the franchising arm, the largest being Nigeria.
Overall, the business reported revenue of US$38,56 million and a profit before tax of US$2,62 million with customer accounts increasing by 11 percent as all fast foods operations were profit- able.
Going forward, Innscor will be looking to consolidate investments made during the period and ensuring target models are achieved with specific focus on gross margin and overhead control.