Tiger Brands’ revenue, gross profit, operating income and profit before tax have continued to decline, according to the group’s financial results for the six months ended 31 March 2018.
This follows after the severe listeria outbreak in South Africa was traced back to a Tiger Brands processing facility in Polokwane.
According to the company’s financial results, group revenue from continuing operations declined 4% to R15,7 billion, while operating income decreased 8% to R2 billion.
Total revenue from domestic operations decreased 3% to R13,8 billion, and operating income declined 4% to R2 billion, with the total operating margin remaining unchanged at 14,2%.
Stock Exchange News Service (SENS), on behalf of Tiger Brands, said that Tiger Brands and its subsidiary, Enterprise Foods, were served with an application of claims for compensation over the listeriosis outbreak.
“It is not possible at this early stage to calculate the damages to which the claimants would be entitled if the liability of the company and Enterprise Foods is established,” SENS said.
The separately identifiable costs associated directly with the recall and suspension of production at its Polokwane, Germiston, Pretoria and Clayville factories, including the cost of destruction of the affected products, would range between R337 million and R377 million on a pre-tax basis.
Tiger Brands’ insurers have also been advised of the intention to lodge claims against the company.
It was anticipated that the maximum potential insurance recovery in respect of the costs would amount to R94 million, the SENS said.