September 4, 2019 / 7:29 AM / 12 days ago

UPDATE 1-Solid core businesses boost South Africa's Libstar H1 earnings

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JOHANNESBURG, Sept 4 (Reuters) - South African food producer Libstar Holdings Ltd said on Wednesday its normalised earnings rose 12.4% in the first half, helped by a strong performance in most of its divisions.

Libstar, which produces fresh foods, including mushrooms, cheeses and ready meals, snacks and confectionery and baked goods, said normalised headline earnings per share (HEPS) from continuing operations rose to 30.9 cents, in the six months ended June 30, from 27.5 cents in the year-ago period.

HEPS is the main profit gauge in South Africa and strips out certain one-off items.

Group revenue rose 4.6%, with organic revenue growth from its core businesses up 5.3% due to rising sales of baked goods and an increase in exports of dry spices and seasonings.

But revenue from its non-core businesses, including natural and flavoured waters and food packaging, which represent 12% of group revenue, fell by 1.5% due to weaker outsourcing and export markets.

In the coming six months Libstar plans to spend a further 57 million rand at dairy producer Lancewood, 26 million rand at ready-to-eat foods business Millennium Foods and 15 million rand at Ambassador Foods to upgrade their facilities, Chief Executive Andries van Rensburg said.

“The second half is expected to reflect the benefits from the commissioning of the par-bake frozen plant in late May and the Pringles manufacturing plant in June,” Van Rensburg said. ($1 = 15.2369 rand) (Reporting by Nqobile Dludla, Editing by Sherry Jacob-Phillips and Louise Heavens)

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