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PIONEER FOOD GROUP LIMITED - Voluntary Trading Update for the 10 months ended 31 July 2015

Release Date: 28/08/2015 07:20
Code(s): PFG     PDF:  
Wrap Text
Voluntary Trading Update for the 10 months ended 31 July 2015

Pioneer Food Group Limited
Incorporated in the Republic of South Africa
Registration number: 1996/017676/06
Share code: PFG
ISIN code: ZAE000118279
("Pioneer Foods" or "the Company" or "the Group")

VOLUNTARY TRADING UPDATE FOR THE 10 MONTHS ENDED 31 JULY 2015

Shareholders are hereby advised that notwithstanding increased competitive intensity, maize
deflation and the exiting of Pepsi and biscuits, the Company has managed to sustain solid
top-line growth. Volume and revenue growth for the major categories for the 10 month period
ending 31 July 2015 is as follows:

                         Volume          Revenue
                            %                %
Bakeries                   11%              15%
Maize                       6%               1%
Wheat                       1%               3%
Rice                        9%               9%
Breakfast Cereals          10%              15%
Local Juices               10%              13%
International               3%              13%

Top-line growth continues to be bolstered by a sustained focus on cost and efficiency
initiatives, translating into strong operating leverage. It should be noted however, that the
maize margin reduces in the second half as a result of a shift to an inflationary commodity
cycle. This has a concomitant effect on the corporate margin. The 2nd half has been
characterised by inter alia:

    -   Significant maize and wheat cost push necessitating staggered price increases;
    -   Softening of Africa export volumes due to extraneous macro conditions;
    -   Maintenance of, and increased market shares;
    -   A recovery in the performance of the Heinz joint venture;
    -   Sustained performance excellence within Bakeries;
    -   Successful exit of Biscuits and Pepsi;
    -   Solid performance from Cereals and the balance of Beverages; and
    -   An improved international fruit performance.

The Company remains committed to meeting its twin objectives of strengthening brands and
expanding margins, whilst embedding the One Pioneer operating model.

In accordance with paragraph 3.4(b)(i) of the Listings Requirements of the JSE, Pioneer Foods
will report to shareholders once a reasonable degree of certainty exists should the earnings
per share and headline earnings per share for the current reporting period ending 30
September 2015 be expected to differ by at least 20% when compared to the prior comparable
reporting period.

The financial information, on which this trading update is based, has not been reviewed or
reported on by the Group´s external auditors.

Tygervalley
28 August 2015

Sponsor
PSG Capital

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