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Johannesburg - Pioneer Food Group [JSE:PFG] said on Friday that its revenue for the four months to January rose 2.3% to R5.5bn from the previous corresponding period.
The rise was due to sales volumes in all business units increasing by about 5% in the group's average product basket, with price inflation moderating to neutral in most categories.
This was mainly due to the strong rand in the second half of last year and improving cost efficiencies.
Operating expenditure such as fuel, electricity and payroll expenses, however, continued to place upward pressure on costs, with grain commodities such as wheat and yellow maize increasing by more than 20% in rand terms in the current financial year alone, it said.
"The unusual weather patterns are a point of concern. The production of wheat and yellow maize in particular has been impacted by the abnormally high summer rainfall and the raisin crop is expected to be substantially lower this year due to the flooding experienced in the Orange River basin," it said.
Consequently, inflationary pressure in its product basket was expected to increase again as the supply of key commodities remains under pressure, leading to anticipated increases in food prices in months to come.
As agreed with the competition authorities, price reductions in defined wheat and bread products were implemented in early December 2010, it said.
The rise was due to sales volumes in all business units increasing by about 5% in the group's average product basket, with price inflation moderating to neutral in most categories.
This was mainly due to the strong rand in the second half of last year and improving cost efficiencies.
Operating expenditure such as fuel, electricity and payroll expenses, however, continued to place upward pressure on costs, with grain commodities such as wheat and yellow maize increasing by more than 20% in rand terms in the current financial year alone, it said.
"The unusual weather patterns are a point of concern. The production of wheat and yellow maize in particular has been impacted by the abnormally high summer rainfall and the raisin crop is expected to be substantially lower this year due to the flooding experienced in the Orange River basin," it said.
Consequently, inflationary pressure in its product basket was expected to increase again as the supply of key commodities remains under pressure, leading to anticipated increases in food prices in months to come.
As agreed with the competition authorities, price reductions in defined wheat and bread products were implemented in early December 2010, it said.
