Zambeef FY pre-tax profits tracking ahead of expectations, H1 EPS surge

Africa-focussed cold chain foods and retail business Zambeef said on Thursday that full-year revenues were anticipated to be in line with current market expectations, while underlying earnings and adjusted pre-tax profits were now projected to exceed expectations.

Zambeef stated EBITDA and pre-tax profits were pegged to come in 20-30% ahead of current market expectations for the year ended 30 September, while earnings per share for the six ended 31 March were expected to be a whopping 2,167% higher year-on-year in US dollar terms.

The AIM-listed firm said the increase in earnings was principally due to "the strong start" it had to the financial year, delivering results of pre-pandemic levels, while cost containment measures also continued to yield "significant savings" and contributed positively to earnings.

Improvements in the load shedding situation, following good regional rains, also resulted in reduced generator fuel expenditure and improved production efficiencies.

Zambeef said: "The half-year period continued to present challenges in the operating environment, resulting from the Covid-19 pandemic and the previous 2020 economic uncertainties, despite greater stability compared to the second half of the 2020 financial year. The rising inflation put pressure on consumer disposable incomes and reduced the share of wallet going towards food spend. Supply constraints on some of Zambeef's product lines further put pressure on cost of inputs.

"Despite the challenges, demand for products, particular poultry products, remained strong allowing the company to remain in line with revenue expectations."

As of 1010 BST, Zambeef shares were up 18.52% at 8.0p.