Tiger Brands posts 4% growth in Full Year 2024 profits to US$39.82M

SOUTH AFRICA – Tiger Brands, a South African packaged goods company, has reported a robust full-year performance, continuing to build on the turnaround momentum, posting a 4% rise in annual earnings to R724 million (US$39.82 million) from R697 million in 2023.

The country’s largest food producer raised prices to offset higher input costs, but they were not enough to boost volume growth amid tight consumer spending.

Revenue rose marginally by 1% from R37.4 billion in 2023 to R37.7 billion. For the domestic business, volume declines were 8%, partially offset by strong growth in exports and international at 6% and 5% respectively.

Notably, within the domestic business, Tiger Brands said there was commendable volume growth from the food service channel, as well as the Beverages and Pasta divisions.

Revenue for Milling and Baking declined by 10% to R8.2 billion, as the Bakeries growth initiatives in H2 were offset by aggressive competitor pricing within the retail channel.

Tiger Brands deliberately managed the depth of discounting and investment behind promotional activities to protect margins. In addition, general trade volumes for Bakeries were lower than anticipated, which management has since rectified with the appropriate activation support.

Culinary revenue increased by 5% to R8.9 billion, with the company saying promotional strategies were key to driving growth for the business, which continued to leverage the brand and product portfolio of Tiger’s power brands via combo deals across the group and focused marketing investment.

The company lauded the continuous improvement initiatives to mitigate supply pressures, with the supply of small white beans, peanuts, and fresh tomatoes significantly affected by local and global weather events, resulting in reduced market availability and pricing challenges.

In the export markets, Davita exports were driven by innovation and market development initiatives. Leveraging the key distributors in the various strategic markets has allowed for consumer insights generation and consequently better in-market execution.

The Grains (Maize, King Food, Jungle, Rice, and Pasta) revenue increased by 2% to R8.5 billion despite rice volume declining due to the Government of India implementing an export ban that ultimately impacted global pricing of parboiled rice, with consumers subsequently trading out of the category into more affordable carbohydrates.

The Snacks, Treats, and Beverages section recorded strong revenue growth of 9% for the full year to R5.8 billion.

Significant increases in global cocoa butter and cocoa liquor prices (c.+63%) impacted Beacon chocolate, while orange supply shortages driven by the Brazilian citrus belt drought saw the price of orange juice input for Oros increasing markedly.

Meanwhile, the Chococam business, part of the International segment, delivered exceptional revenue growth versus the prior year, mainly driven by the chocolate spreads category and the export markets.

Looking ahead, Tiger Brands remains optimistic but is immersing itself in improvement initiatives to produce affordable product solutions as a key enabler for its turnaround strategy, particularly when consumers remain under pressure.

1 South African Rand (ZAR) is approximately equal to US$0.055

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