COMPANY COMMENT: Growing sales should be top of list for Tiger
CEO Lawrence MacDougall’s first real stamp on the business shows focus is now core brands and margins
Stripping the management bumpf out of Tiger Brands’s strategic review (Optimise portfolio for current performance and future potential), the message is pretty clear: Gain market share in all its categories, cut costs, reinvest the proceeds in marketing and research and development and grow operating margins.The review is CEO Lawrence MacDougall’s first real stamp on the business and contains an admission that the pursuit of geographic diversification in the past led to a loss of focus, as well as thinly spread resources. The focus now is core brands and margins and Tiger wants these to swell by between 100 and 160 basis points over the next five years – taking them to north of 15%. But, for the time being, it may be sales that should concern the market more. Latest revenue increases were all down to price — not volumes, which retreated more than 3% in the six months to the end of March. Given an economy teetering on recession, that’s unlikely to improve drastically anytime soon — es...
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