Tiger Brands Burning bright* (*for as many as six or seven hours a day)
A sad set of interims this week from the Striped One, whose CEO Noel Doyle observes evocatively that the consumer’s “elastic has snapped”, and the resilience we saw in December is now a thing of the past. Total revenue rose +16% to R19.4bn for the six months through March, driven by price inflation of +17%, and overall volumes declined -1%, while net profit dropped -3.3% to R1.19bn. Within the business, Tiger was surprised by the sales drop in its Crosse & Blackwell, Koo and All Gold brands as cash-strapped punters opt for cheaper brands and even go without. On the upside, they did see a strong volume recovery in Bakeries, Snacks & Treats and Personal Care and good performances in Sorghum Breakfast, Rice, Beverages, and Out of Home, their words. Loadshedding costs, a line item nowhere else in the world, were R76m, compared with R12m for the corresponding period last year. “Despite the immediate headwinds, we will continue to balance short-term impact with long-term growth without compromising the future sustainability of the business,” the Group said.
Comment: The potential that great businesses like Tiger Brands bring to an economy is being squandered by an ineffectual national administration.