Tiger Brands share price drops to lowest in seven years
The company said it expects trading conditions to remain challenging in the second quarter as earnings drop
SA’s largest food producer Tiger Brands’ share price dropped to its lowest levels since September 2011 on Wednesday morning after it said that it expects earnings to drop by as much as 37% in the six months to end-March 2020.
Tiger Brands said its headline earnings per share (HEPS) from total operations are expected to be between 533c and 478c, a decrease of between 30% and 37% from the comparable period last year, citing a difficult first quarter.
The first three months were largely affected by challenges in the company’s grains portfolio, affecting bakeries, pasta and rice products.
“A continuation of the difficult trading conditions is anticipated in the second quarter, with ongoing volume and pricing pressures within grains, while indications are that the quarter will be challenging for groceries,” the company said.
HEPS from continuing operations, which includes the value-added meat products (VAMP) is expected to have decreased between 29% to 36%, to between 552c and 497c.
At 1.40pm, the share price was down 7.40% to R184.37.
Update: February 12 2020
This article has been updated to reflect the correct share price.