Tiger Brands (TBS) H1 2026 earnings summary

Executive summary

• Achieved strong volume-led growth, with normalised volume up 4.5% and revenue up 2.8% year-over-year, regaining market share and improving accessibility and affordability for consumers.

• Significant progress in portfolio optimization, including disposals of non-core businesses such as Randfontein, Chococam, Beacon, and King Foods, with King Foods retained after a successful turnaround.

• Maintained strong cash generation, enabling record special dividends (ZAR 5.8 billion) and share buybacks (ZAR 3.4 billion) over the past few years, with R7.4 billion returned to shareholders in H1 26.

• Digital transformation initiatives, including automation, AI, logistics control tower, SAP IBP, and route optimisation software, are delivering operational efficiencies and better management insights.

• Interim dividend of 430cps declared, maintaining 1.25x cover policy based on HEPS.

Financial highlights

• Reported revenue grew 1.3% to R17.9bn; normalised revenue (excluding Rice) up 2.7%.

• Operating income increased 26% to R2.06bn; operating margin rose to 11.5% from 9.3%.

• Adjusted continuing EPS up 21.4% (949c vs. 782c); adjusted continuing HEPS up 24.1% (980c vs. 790c).

• Working capital per R1 revenue improved 4% year-over-year; working capital days reduced to 39 from 65.

• Cash generated from operations was R2.4bn, with a cash conversion ratio of 54%.

Outlook and guidance

• Guidance remains unchanged, with continued focus on disciplined capital allocation, margin improvement, and growth.

• Short- to medium-term guidance: volume growth 1–3%, revenue growth above inflation, operating margin towards 12%, ROIC >20%.

• Long-term guidance: volume growth 4–6%, operating margin towards 15%, ROIC >25%.

• Ongoing investment in mega sites, Super Bakery, and digitalization to drive future growth and efficiency.

• Anticipate muted impact from fuel price increases due to logistics optimization and promotional management.