Announces increase in revenue for six-month period ended 30 June 2024
Libstar today announced its financial results for the six-month period ended 30 June 2024,
noting continued progress in executing its simplification, growth, and sustainability initiatives as
per the Group’s new strategic direction that was introduced in 2023.
Despite the challenging market landscape, intensified by adverse economic conditions, the
Group recorded revenue growth of 5.2% for the first half of 2024, driven by the strong
performance of the Ambient Products category, which grew revenue by 9.1%.
The Group’s gross profit margin increased to 21.5% (H1 2023: 21.2%) due to effective price
realisation, cost management, improved product basket mix and production efficiencies. Cash
generated from operations increased by R2.1 million from R279.3 million to R281.4 million.
“We are pleased with the Group’s progress as we continue to implement our new strategic
Charl de Villiers, Chief Executive Officer of Libstar.
direction and remain committed to delivering further tangible positive outcomes during the
traditionally more profitable second half of the year,”
Performance by category
- Volume sales for the Ambient Products category (which contributes 48% of Group revenue)
increased by 1.6% and price/mix increased by 7.5%. This result was driven by a strong
performance of the Group!s retail wet condiment offerings and the recovery of wet condiment
volumes of 32.3% in the industrial channel relative to the weak demand in the comparative
period.
- The revenue for the Perishable Products category (which contributes 47% of Group revenue)
increased by 2.0%, of which 4.2% was due to positive price/mix changes. Volumes declined by
2.2%, driven by lower beef volumes in the food service channel.
- Revenue from the Household and Personal Care category (which contributes 5% of Group
revenue) increased by 1.3%, while volumes declined by 0.9% and price/mix increased by 2.2%.
Performance by sales channel
The retail and wholesale channel revenue contribution increased slightly to 59.2% (H1 2023:
58.3%) of Group revenue, whilst the food service channel revenue contribution decreased to
18.7% (H1 2023: 20.8%) of Group revenue.
Simplifying the Group’s portfolio and operating model
Following the reporting period, the Group has entered into a sale agreement to dispose of its
Chet Chemicals business unit, marking tangible progress in Libstar’s efforts to reduce its
exposure to non-food categories. The Group will continue to explore strategic options related to
its only remaining non-food business, Contactim.
Libstar also resolved to exit its current beverage manufacturing operations by closing the
Franschhoek-based Chamonix Spring Water plant effective 31 August 2024.
The Group is on track to finalise the simplification of its operating structures within the newly
established Perishables Products (previously Perishables) and Ambient Products (previously
Groceries, Baking & Baking Aids and Snacks & Confectionery) super-categories by the end of 2024.
Household & Personal Care remains as a third category while Libstar!s efforts to reduce its exposure to non-food categories continues.
“Our Group’s category-led strategy and organisation structure are designed to leverage its
strengths and resources to maximise efficiency, responsiveness and growth potential. By
organising around specific product categories, Libstar can better meet the needs of its
customers, consumers, drive innovation and cost savings, and achieve its strategic objectives,”
Focused on delivering sustainable profitable growth
Looking forward:
- In the Ambient Products category, the Group will remain focused on executing on its strong
pipeline of export orders and growing its food service product range both locally and
internationally. - In the Perishable Products category, Libstar will continue to drive operational efficiencies and
market opportunities within its integrated operating model in the second half of 2024.
