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PREMIER GROUP LIMITED - Group financial results for the year ended 31 March 2025 and cash dividend declaration
2025/06/10 07:05:00Download PDF Stock report
Group financial results for the year ended 31 March 2025 and cash dividend declaration
PREMIER GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2007/016008/06)
JSE share code: PMR
ISIN: ZAE000320321
('Premier', the 'Group' or the 'Company')
GROUP FINANCIAL RESULTS FOR THE YEAR ENDED 31 MARCH 2025 AND CASH DIVIDEND DECLARATION
FINANCIAL OVERVIEW
- Revenue increased by 7.0% to R19.9 billion
- EBITDA(1) increased by 14.7% to R2.4 billion
- Operating profit increased by 16.9% to R1.9 billion
- Earnings per share ('EPS') increased by 31.0% to 936 cents per share
- Headline earnings per share ('HEPS') increased by 26.8% to 943 cents per share
(1) Earnings before finance income and finance costs, foreign exchange (losses) /
gains, share of net profit in equity-accounted investments, tax, depreciation
and amortisation
COMMENTARY ON PERFORMANCE
Premier is pleased to announce our results for the year ended 31 March 2025. Through
meticulous margin management and efficiencies, as well as a commitment to producing
quality products at the lowest cost, moderate revenue growth has been leveraged into
meaningful improvement in operational earnings. Lower global wheat prices compared
with the prior year, as well as soft trading in the maize category driven by record
high, weather-induced raw maize prices, detracted from revenue growth for the year.
Staying the course and maintaining a clear focus on our long-term strategy of
investing in state-of-the-art facilities and the upskilling and engagement of our
workforce has enabled Premier to show resilience and deliver on its intention of
creating sustainable value for its stakeholders.
The Group's revenue increased by 7.0% to R19.9 billion, supported by revenue growth
in both the Millbake and the Groceries and International divisions of 5.7% and 13.3%
respectively.
EBITDA increased by 14.7% to R2.4 billion. Millbake EBITDA grew by 14.7%, while the
Groceries and International EBITDA grew by 9.2%. The Group's EBITDA margin improved
by 80 basis points to 11.8% compared to the prior year level of 11.0%.
Operating profit increased by 16.9% to R1.9 billion. The operating profit margin
improved by 80 basis points to 9.6% when compared to last year.
Net finance costs decreased by 16.7% to R306 million, the result of debt repayments
made on borrowings and the reduction of interest rates post the refinancing of the
syndicated debt facilities during the year.
EPS increased by 31.0% to 936 cents and HEPS increased by 26.8% to 943 cents, when
compared to last year.
Cash generated from operations was in line with the prior year, at R2.4 billion,
enabled by growth in EBITDA and supported by disciplined working capital management.
The Group's net debt on 31 March 2025 was R1.7 billion, translating into a leverage
ratio of 0.7x for the Group, down from 0.9x in the prior year. Cash generated by the
Group has enabled it to continue reducing the leverage ratio compared to historical
levels. Voluntary capital repayments on borrowings of R340 million were made during
the year. At 31 March 2025, R1.4 billion on the Revolving Credit Facility remains
available for drawdown for future funding needs.
MILLBAKE
The Millbake division achieved a stellar set of results, displaying resilience
despite a challenging economic environment. Revenue increased by 5.7% to R16.4
billion and EBITDA increased by 14.7% to R2.3 billion. The EBITDA margin of 13.7%
improved by 100 basis points compared to last year. The increase in revenue is
attributable to a price/mix growth of 2% and volume growth of 4%.
Improvement in EBITDA continues to be driven by a resolute focus on efficiencies, a
disciplined cost containment mindset and service level excellence. Site efficiencies,
attained through upgrades of several bakeries and wheat mills, and our relentless
focus on product quality, recipe optimisation and best-in-class manufacturing
processes, continue to reflect in the quality and consistency of our premium Millbake
products. The latest upgrade to our infrastructure stable, the Aeroton mega-bakery,
remains on track to be commissioned in the second half of FY2026.
GROCERIES AND INTERNATIONAL
A good performance was achieved in the Groceries and International division. The
division's revenue increased by 13.3% to R3.5 billion and EBITDA increased by 9.2%
to R233 million. The EBITDA margin declined slightly by 30 bps to 6.7%.
The Home and Personal Care ('HPC') category had a pleasing year. The additional
capacity installed in tampon manufacturing and packaging has enabled improved service
levels, contributing to volume gains in the local business. The HPC supply chain
strategy, focused on becoming the best cost manufacturer to drive market share and
brand equity, is gaining traction.
Sugar Confectionery's performance experienced some disruptions during the year which
impacted service levels. The new private label contracts and product launches
continue to gain momentum and the new liquorice line, commissioned in December 2024,
will add exciting new product ranges to the confectionery offering. The first phase
of site consolidations has been completed, which is anticipated to enhance
efficiencies between the two sugar confectionery sites.
Post-election tension and civil unrest in Mozambique impacted CIM's operations. The
country is experiencing a severe currency shortage, restricting grain and other raw
material imports. Focus shifted during the year to direct local sales to the informal
market and to growing exports.
CASH DIVIDEND DECLARATION
Premier is pleased to announce that, in line with its policy of paying out 30% of
diluted HEPS as dividends, a final gross dividend of 271 cents per share (2024: 220
cents per share) has been declared out of the Company's reserves, in respect of both
the ordinary shares of no-par value and the unlisted 'A' and 'A1' ordinary shares of
no-par value, for the year ended 31 March 2025.
Cash flows over FY2025 remained ahead of expectations and the Company has shown
strong deleveraging of the balance sheet ahead of initial guidance. Premier continues
to maintain appropriate cash reserves to execute on committed capital requirements,
as well as to retain flexibility to assess organic and inorganic growth opportunities
as they may arise. Furthermore, the Board is satisfied that the Company is solvent
and liquid, and that it has sufficient capital and reserves after the payment of the
final dividend, to support its operations for the foreseeable future.
A dividend withholding tax of 20% (or 54.2 cents per share) will be applicable,
resulting in a net dividend of 216.80000 cents per share, unless the shareholder
concerned is exempt from paying dividend withholding tax or is entitled to a reduced
rate in terms of an applicable double-tax agreement. The Company's tax reference
number is 9102629160.
The salient dates relating to the payment of the dividend are as follows:
Last day to trade in order to participate in the dividend Tuesday, 8 July 2025
First day to trade ex-dividend Wednesday, 9 July 2025
Record date Friday, 11 July 2025
Payment date Monday, 14 July 2025
Share certificates may not be dematerialised or rematerialised between Wednesday, 9
July 2025 and Friday, 11 July 2025, both days inclusive.
In terms of the Company's Memorandum of Incorporation, dividends will only be
transferred electronically to the bank accounts of shareholders. In the instance
where shareholders do not provide the Transfer Secretaries with their banking
details, the dividend will not be forfeited but will be marked as 'unclaimed' in the
share register until the shareholder provides the Transfer Secretaries with the
relevant banking details for payout.
OUTLOOK
Moderate revenue growth is anticipated for the most part of FY2026, driven by
substantial declines in maize input prices and subdued global wheat prices. Maize
prices are expected to soften by mid-2025, which will enable Premier to pass through
cost savings to burdened consumers. Local food inflation will be impacted in 2025 by
Eskom tariff hikes and failing water infrastructure mitigation. The two-year capital
project to refurbish the Aeroton bakery to the standards of Premier's coastal sites
and the mega-bakery in Tshwane (Pretoria) is expected to further enhance efficiencies
and step change bread quality in the inland region. The Aeroton bakery will replace
the capacity of three small-scale, older generation bakeries in the region.
Investments in the HPC factory, scheduled for commissioning during H1 2026, are
expected to further improve efficiencies and economies of scale.
The Board and management will continue to remain disciplined in the further allocation
of capital, selecting value enhancing projects to create sustainable stakeholder
returns.
A continued focus on diversity, inclusivity, equity and belonging as the basis for
constructive engagement with our workforce, will assist in future-proofing Premier,
enhancing skills, succession planning and ensuring we are an employer of choice. We
have made great strides in establishing healthy succession planning metrics across
all operating divisions and more recently applied particular focus on executive
leadership development as a key building block of our succession planning strategy.
We will continue to progress these customised executive level initiatives, enabling
us to seamlessly deliver on our leadership succession plan.
Playing a part in providing food security for the nation is integral to our strategy
and commitment to serving our low-income consumers. Our sustainability journey will
remain high on the agenda and continue to manifest through tangible actions. With
our broad staples product offering, efficient low-cost production model and extensive
distribution capability, we are well placed to continue serving our broad base of
consumers and contributing to food security.
Premier continues to look for corporate acquisitions and industry consolidation
opportunities to broaden its footprint in consumer packaged goods. Management has a
clearly defined set of criteria to assess opportunities and will remain disciplined
in its efforts to augment its organic growth strategies and drive investor returns.
Any forward-looking information contained in this announcement has not been reviewed
or reported on by the Group's auditors.
ABOUT THIS ANNOUNCEMENT
The contents of this results announcement are the responsibility of the directors of
the Company and have not been reviewed or audited by the Group's auditor.
This announcement is a summary of information in the audited consolidated annual
financial statements for the year ended 31 March 2025 ('results') and does not
contain full or complete details. Any investment decisions by investors and/or
shareholders should be based on the results. The results and the summary consolidated
annual financial statements are available on the JSE's cloudlink at
https://senspdf.jse.co.za/documents/2025/JSE/ISSE/PMRE/20250610.pdf
and published on the Company's website,
https://www.premierfmcg.com/investors/results-reports
on 10 June 2025.
PricewaterhouseCoopers Inc., the Group's independent auditor, has audited the
consolidated annual financial statements of the Group from which this announcement
has been derived and has expressed an unqualified audit opinion on the consolidated
annual financial statements.
Non-executive directors
I van Heerden (Chairman), JER Matthews, PRN Hayward-Butt (Alternate Director to JER
Matthews)
Independent non-executive directors
FN Khanyile (Lead Independent), DD Ferreira, H Ramsumer and W Sihlobo
Executive directors
JJ Gertenbach (Chief Executive Officer), F Grobbelaar (Chief Financial Officer)
Company Secretary: B Baker
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
10 June 2025
Date: 10-06-2025 07:05:00
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