Food services group Bidcorp said yesterday that it delivered a record performance in an environment where management teams were able to maximise the trading opportunities created by resurgent demand across the broader food service market and higher inflation.
In its results for the financial year to June 2023, the group said profit increased by 41.5% year on year to R6.95 billion, while headline earnings per share (Heps) rose by 35.4% to 2082.9c.
The group reported that revenue was R196.3 billion, up 33.4% compared to 2022: R147.1bn.
‘’Currency volatility, particularly in the second half of the reporting period, positively impacted the rand-translated Heps by 10,1%. Activity levels in every market showed real growth and market share gains.
‘’However, the rate of growth moderated in the second half as businesses cycled through the buoyancy seen in the latter part of F2022. Overall demand in Bidcorp’s hospitality markets remained strong, well surpassing the pre-pandemic trajectory.
The board declared a final cash dividend of 500 cents per share for the reported period, compared to 400 cents per share in 2022, representing approximately 2.2 times Heps cover, in line with group policy.
Bidcorp CEO Bernard Berson said: ‘’The results were good on all fronts, and we are very proud of them. There are a number of reasons for these results, but one of them was the very strong recovery. People resumed their spending habits. We were in good shape to pick up on that trend and were able to capitalise on it. We were well positioned once the recovery happened after the Covid-19 pandemic’’.
Berson said the future was going to be more difficult than last year, but that's okay. ‘’We're up for a challenge. We're very comfortable with where we're at,’’ he said.
He said the balance sheet was in good shape. ‘’We've got a lot of headroom to do what we need to do with our financial position,’’ he said.
The group reported that Australasia delivered a fantastic performance both in terms of revenue growth and margins achieved. Normal seasonality returned to Europe, with all businesses delivering much improved performances.
‘’The UK benefited from contract wins and new acquisitions, achieving good growth albeit at lower margins. Emerging Markets delivered real top-line growth, but profitability was impacted by ‘growing pains’ in several businesses,’’ it said.
Berson said Bidcorp's focus was on the correct exposure to both the discretionary and non-discretionary market segments remains a priority for its businesses, the correct balance of which has contributed to the strong performance in all its markets.
‘’Stubbornly high food inflation has complicated trading, but overall has been beneficial to the businesses. Higher cost inflation has been driven by labour, energy, and fuel cost increases, which only started to slow in the latter part of the financial year as labour availability, supply chain disruptions, and product shortages started to ease,’’ the group said.
Investment activity in distribution capacity and bolt-on acquisitions has accelerated in the 2023 financial year as businesses cater to current and future growth, it said.
Looking ahead, Berson said: “The strong bounce in consumer behaviour experienced through F2023 has tapered off, which is, in our view, a return to normality.
‘’We believe there remains more market share to be gained in every geography we operate, and we have the management teams and the business model to continue to outperform. Activity levels into July and August are within management’s expectations, and we remain positive that we can continue to deliver real growth into the financial year ahead.’’
BUSINESS REPORT