Libstar reports its strongest first-half performance since H1 2022, supported by volume growth, cost optimisation, and improved operational efficiencies.
Growth was especially strong in the Ambient Products super-category, with gains powered by improved capacity utilisation, strategic pricing, volume growth, and a sharper focus on value-added food solutions. Notably, Cape Herb & Spice’s branded revenue in the export channel grew by more than 40%. In the Perishable Products super-category, Lancewood continued to grow market share in cheese and yoghurt.
“These results clearly demonstrate the strength of our transformation. By simplifying our portfolio, sharpening execution, and accelerating growth in our priority categories, we are building real momentum. They reaffirm our commitment to delivering on our strategic priorities, driving financial resilience, and positioning Libstar as a strong business set for sustainable growth,” said Charl de Villiers, Libstar’s Chief Executive Officer.
Key Financial Highlights
- Revenue up 6.7% year-on-year to R5.96 billion supported by volume growth, a favourable category mix, cost optimisation, and improved operational efficiencies.
- Operating profit of R296 million, up 16.7%.
- Normalised EBITDA increased by 7.5% to R465 million, with the EBITDA margin improving to 7.8%.
- Cash conversion ratio of 110%, demonstrating strong working capital discipline.
- Category growth in Ambient (+6.0%) and Perishables (+7.6%), driven by volume and price.
De Villiers added: “Our latest results demonstrate record H1 performance across key financial metrics, including EBITDA, gross margin, and cash conversion, alongside a notable improvement in gearing. Significantly, the gearing ratio has strengthened from 1.6x to 1.3x, while cash conversion has reached 110%, far surpassing the 65% target, driven by an improved trading result and release of working capital.”
Category Performance Highlights
Ambient Products: Strong growth in Wet Condiments, driven by retail channel gains across Goldcrest, Denny, Safari, and private label sauces, pestos, and vinegars. Cape Herb & Spice achieved own-branded growth of more than 40% in international markets.
Perishable Products: Lancewood gained retail market share in hard and soft cheese and yoghurt. Value-added Meats saw strong demand for fresh and frozen chicken, while Denny Fresh Mushrooms delivered improved yields and topline growth.
Libstar’s streamlined portfolio and operating model are paying off. Recent decisive actions, such as closing the Denny’s Fresh Mushrooms Cape Town (Phesantekraal) facility, integrating the remaining business of Dickon Hall Foods into Montagu Foods, and divesting Umatie baby food, have reduced fragmentation and sharpened the Group’s competitive edge.
The establishment of a shared-services structure in the Wet Condiments sub-category, along with the integration of Rialto’s Retail division, Ambassador Foods (Snacks division) and Cape Coastal Honey (Spreads division), further strengthen efficiencies and customer alignment.
The Group also announced a new distribution agreement with General Mills to grow brands such as Häagen-Dazs, Pillsbury, Nature Valley and Old El Paso in South Africa.
Preliminary Engagement
Libstar confirms it has received non-binding expressions of interest regarding the potential acquisition of all securities currently in issue. These discussions are at an early stage, and there is no certainty that they will result in a binding offer. The Group’s strategy execution, capital allocation priorities, and day-to-day operations remain unaffected.
“Looking ahead, we remain committed to sustaining momentum and driving growth, even in the face of a constrained consumer environment and global uncertainty. Our focus is clear: resilience, innovation, and long-term value creation. Some of our key priorities include driving operational efficiencies, expanding export markets and international listings for Cape Herb & Spice, accelerating innovation and enhancing supply chain agility and sustainability,” said de Villiers.
He concludes; “Through a series of deliberate actions over the past two years as we work towards our strategic goals for 2027, Libstar will, by year-end, have transformed into a significantly streamlined two-category, sub-category-focused business, led by a smaller leadership team with greater strategic alignment, sharper operational execution, and a more efficient cost structure. With the dedication and talent of our employees, we are not only navigating tough conditions but setting the pace in our industry – positioning the business to capture new opportunities and build a stronger, more competitive future.”
