Afgri generates 19.6% growth

18 May '06

3 min read

Afgri Limited has posted an increase of 19.6 percent in earnings for the financial year to February 2006, with continuing operations' sales at R5.4 billion more or less unchanged from the previous year.

Highlights:
- Group earnings up 19.6 percent
- Continuing operations headline earnings up 144 percent
- Capital distribution of 21.18 cents per share
- Cotton ginning interests sold to Cargill
- Re-entry into broiler business through Daybreak Farms acquisition

Headline earnings increased by 8.8 percent over the previous year. Headline operating profit from continuing operations – after interest and dividends – was up a creditable 19 percent.

Earnings per share increased 19.6 percent to 39 cents over the prior year's pro forma earnings per share of 32.6 cents. This was due largely to improved performances in the Handling & Storage and Producer Services' Retail and Equipment businesses.

Prior year earnings were impacted by the once-off R35 million Secondary Tax on Companies (STC) charge on the special dividend paid as a consequence of the group's BEE transaction.

Afgri Managing Director Jeff Wright says the results are particularly pleasing in the light of the difficult conditions prevailing in the agricultural sector.

There was a 52 percent improvement in the performance of the Producer Services' Retail and Equipment business following a 25 percent reduction in fixed costs, substantial lowering of stocklevels and the phasing out of non-viable retail branches.