Astral Foods Limited on Monday reported a 14% drop in full-year earnings weighed down by increased costs and the impact of Covid-19 pandemic, despite its poultry business boosting annual revenue.
The poultry producer, which also makes animal feed, said its headline earnings per share, the main profit gauge used in South Africa that strips out some one-off items, fell to 14.6 cents for the year ended September, from 16.5 cents a year earlier.
Astral said closure of hospitality, restaurants and Quick Service Restaurants during a coronavirus lockdown, caused surplus chicken in the market and price cutting to clear stock levels.
The country went into lockdown late March that forced non-essential business and industries to temporally halt operations.
The company said it’s has financial results were impacted by costs caused by the pandemic, national power cuts and municipal infrastructure challenges impacting its Standerton processing facility.
However, annual revenue rose 4.6% to R14.1 billion ($913.12 million) from R13.5 billion a year earlier driven by its poultry division, external feed sales and hatching eggs sales.
“Astral can proudly report satisfactory results, with all its integrated operations continuing to run like clockwork during South Africa’s hard lockdown,” said Astral CEO Chris Schutte. The company declared a final dividend of 775 cents per share compared with 425 cents a year earlier.
By 0740 GMT, shares were 4.89% higher compared with the broader All-Share index, which strengthened 0.41%.