AVI (AVI) H2 2024 earnings summary

Executive summary

• Achieved strong financial performance despite challenging macroeconomic and consumer environments, with group revenue up 6.3% to R15.86 billion and operating profit up 21.7% to R3.3 billion, supported by robust innovation, price increases, and cost control.

• Headline earnings per share increased 24.1% to 687.1 cents; strong cash generation enabled a reduction in net debt and supported higher dividends, including a special dividend.

• Product innovation, automation, and efficiency gains drove margin recovery to pre-pandemic levels.

Financial highlights

• Revenue rose to R15.86 billion (+6.3% year-over-year); gross profit up 13.5% to R6.61 billion, with gross margin at 41.7%.

• Operating profit increased to R3.3 billion (+21.7%), with margin at 20.8%.

• Headline earnings reached R2.27 billion (+24.2%); HEPS at 687.1 cents (+24.1%).

• Cash generated by operations rose 22.7% to R3.78 billion; cash conversion at 98.1%.

• Dividend yield was 9.2% on the closing share price, with a full year dividend of 590 cps and a special dividend of 280 cps.

Outlook and guidance

• Management expects continued constrained consumer demand, increased competition, and margin pressure, with ongoing price/volume management and hedging to protect margins.

• Ongoing investment in manufacturing resilience and efficiency, including capital projects to address infrastructure challenges.

• I&J's outlook depends on improved catch rates, Asian abalone demand, and the commissioning of a new freezer vessel.

• Footwear & Apparel to focus on price/volume management, cost control, and supply chain challenges.

• Planned capital expenditure of R481 million for FY25, targeting production upgrades and efficiency.