Libstar gets profit boost from improved margins and JSE listing
Consumer goods group Libstar says it expects double-digit profit in its year to end-December as it benefits from improved margins and a reduction in debt after it listed in May 2018.
The group, whose brands include Lancewood cheeses and Denny mushrooms, expects headline earnings per share to rise by 7.2%-12.2% compared to the prior period's 74.6c. This includes the effects of accounting changes which bring leases on to the company's balance sheet.
Gross profit margins improved in each of the group’s product categories, it said
Lower dry-condiment input costs, favourable sales mix changes as well as the group’s continued focus on procurement practices, production efficiencies and overall equipment effectiveness contributed to the improved margin result.
The group said its net interest expenses, excluding accounting changes, declined 30.7% to R153.7m, as a result of a R700m reduction in net debt following its JSE listing in May 2018.
The company had raised about R3bn when listing.
In morning trade on Tuesday its share price was up 3.13% to R7.25, giving it a market capitalisation of R4.9bn.
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