AVI (AVI) H2 2026 earnings summary

Executive summary

• Performance was resilient despite a challenging environment, with a strong first half and a tougher second half due to rising energy costs and market slowdown from February onward.

• Revenue increased by 1.4% year-over-year to R16.24 billion, with operating profit up 4.4% to R3.72 billion and margin improving to 22.9%.

• Headline earnings per share rose 5.3% to 767.9 cents, supported by strong cash generation and a reduction in net debt.

• Final dividend rose in line with headline earnings, with a special dividend declared, resulting in a total dividend yield of 9.6%.

• Return on capital employed reached 35.7% for the year.

Financial highlights

• Revenue grew 1.4% year-over-year, mainly from price increases to offset higher input costs, though volumes declined.

• Operating profit rose 4.4%, with margin improving to 22.9% due to cost savings and restructuring.

• Net debt reduced by 26.4% to R1.67 billion; net debt/EBITDA at 0.4x.

• Cash generated by operations improved 10.6% to R4.41 billion, with cash to EBITDA conversion at 101.8%.

• Headline earnings: R2.56 billion (+6.0% YoY); HEPS: 767.9 cents (+5.3% YoY).

Outlook and guidance

• The business anticipates continued macroeconomic challenges in South Africa, with no expectation of an easy financial year ahead.

• Focus remains on medium-term resilience, innovation, and efficiency, with ongoing investment in process improvements and new product development.

• Commodity input costs are largely hedged, with a benign outlook for most categories except energy.

• Management expects to continue capital deployment for innovation and efficiency, with potential for acquisitions if suitable opportunities arise.

• Approved capital expenditure of R441 million for F27 to support innovation and infrastructure.