Clover expects 20% increase in earnings on improved market conditions

SOUTH AFRICA – The branded foods and beverages group, Clover Industries Ltd expects headline earnings per share (“HEPS”) for the year ending 30 June 2018 to increase more than 20% stating improved market conditions in the period.

In a trading statement released 28 June, the group said its earnings per share (Eps) would also lift by a similar margin during the period, which is 16.60cents higher than the 83.10c reported in June 2017.

IOL Business reported that despite a positive outlook for the year, its stock continued was down with shares falling to US$1.18.

Clover however, said it did not have reasonable certainty to provide guidance on the specification of the increases.

“Shareholders are further advised that Clover does not currently have reasonable certainty to provide guidance as to either the specific percentage and numbers, or the range and numbers, to describe the difference in the financial results in such periods.

Once Clover obtains reasonable certainty in this regard it will issue a further trading statement,” said the statement.

Improvement initiatives

In the six months to December 2017, the group reported 7.7% revenue growth to US$352.50 million attributable to efficiency improvement initiatives.

High revenues were realized through establishment of the Dairy Farmers SA (DFSA), which contributed to high volumes of raw milk collected.

Other initiatives include restructuring of the raw milk supply for the dairy segment allowing the company focus on value-addition in the business.

However, as a result of subdued economic conditions last year, Clover indicated alongside other food producers and retailers, it faced an exceptionally challenging year.

According to Chief executive Johann Vorster, the most significant impacts on last year’s performance were the prolonged drought, a wetter and cooler summer and rand volatility, all beyond the group’s control.

The Company expects to release its annual financial results for the year ending 30 June 2018 at around 12 September 2018.

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