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Johannesburg - South Africa's biggest consumer foods maker Tiger Brands reported a small rise in first-half profit on Wednesday, held back by rising raw material costs at home and its underperforming Nigerian unit.
Tiger Brands, which makes cereal, energy drinks and rice, said diluted headline earnings per share rose 6% to 848.7 cents in the six months ended March.
Sales rose 11% to R14.9bn.
Tiger Brands, along with its rivals, has been weighed down by rising raw material prices due to the weaker rand, while debt-laden consumers cut back on spending.
In a bid to offset slow growth at home, Tiger Brands has been looking to the rest of Africa and put Nigeria at the heart of its expansion plans.
However, its recently acquired flagship Nigerian business Dangote Flour Mills (DFM) has been losing money, forcing Tiger Brands to write down R849m of its value.
"We are currently implementing short to medium action plans which include reducing DFM’s fixed cost base, mothballing of mills where appropriate and rebuilding the brand equity of its product basket," said Peter Matlare, chief executive officer of Tiger Brands.
Tiger Brands paid $188m for just over 60% DFM two years ago.
Tiger Brands, which makes cereal, energy drinks and rice, said diluted headline earnings per share rose 6% to 848.7 cents in the six months ended March.
Sales rose 11% to R14.9bn.
Tiger Brands, along with its rivals, has been weighed down by rising raw material prices due to the weaker rand, while debt-laden consumers cut back on spending.
In a bid to offset slow growth at home, Tiger Brands has been looking to the rest of Africa and put Nigeria at the heart of its expansion plans.
However, its recently acquired flagship Nigerian business Dangote Flour Mills (DFM) has been losing money, forcing Tiger Brands to write down R849m of its value.
"We are currently implementing short to medium action plans which include reducing DFM’s fixed cost base, mothballing of mills where appropriate and rebuilding the brand equity of its product basket," said Peter Matlare, chief executive officer of Tiger Brands.
Tiger Brands paid $188m for just over 60% DFM two years ago.
