Bidcorp gets South Africa and UK boost

Bidcorp has delivered a strong performance in its latest financial results for the half-year ended December 31 2024, buoyed by strong performances in South Africa and the UK.

The food services group said that it was able to increase revenue by 7.1% in constant currency despite the challenging economic and trading environment.

After adjusting for relevant food-basked inflation and acquisitions, the business has grown by around 5% in real terms.

Currency volatility negatively impacted the rand’s financial performance by 4.0%. Headline earnings per share jumped by 6.0% to 1,221.6. At a constant currency level, it would have increased by 10.0%.

However, basic earnings per share declined by 2.0% to 1,120.7 cents per share primarily due to the non-cash losses incurred on the exit of our German operations.

The group said that the UK delivered an improved performance in its core food service operations, which benefitted from an acquisition to supplement the regional independent activities.

The Emerging Markets section also saw a strong performance from the South African businesses. That said, the group said that activity in Greater China remains subdued by the macro environment.

The European business also performed well under challenging macro conditions, with growth in revenues and trading profits.

Although trading conditions in Australasia were also challenging, Australia and New Zealand still delivered solid trading performances.

The group said that activity levels in Q1 were impacted by unseasonably cold and wet September weather in the Northern Hemisphere and extreme weather-related flooding in Eastern Europe.

Although this was a detriment to the group’s UK and European businesses, improvements were going into Q2 and the festive season.

“Food inflation has disappeared, however, cost inflation remains sticky, driven by ongoing wage pressures from labour availability, particularly in the warehouse and driver categories.”

“As economic conditions have tightened in many geographies, customers have become more price-sensitive and competition has increased,” said the group.

“Investment activity, primarily into new distribution capacity, has continued to cater for current and future growth. Acquisition activity has increased with eight bolt-on opportunities concluded in the period.”

The group declared an interim cash dividend of 560 cents per share for the half-year ended December 31 2024. This was an increase of 6.7%.