Poultry sales boost Sovereign

SOUTH AFRICA - Poultry processing group Sovereign Food Investments has reported a sharp rise in its headline earnings per share for the year to end-February 2005, to 124.2c from 22.3c a year earlier.

The group proposed a final capital distribution out of share premium of 35c per share, for a total for the year of 40c per share, up from 10c in 2004.

Announcing its final results on Tuesday, Sovereign Food said the South African poultry industry was benefiting from increased consumer spending power, with poultry meat the "protein of preference" for emerging consumers.

This, coupled with aggressive industry pricing due to vastly improved efficiencies, had resulted in strong growth-supply and demand had remained balanced despite industry expansion.

Looking ahead, Sovereign said its expectations were for marginally lower poultry prices in the coming year due to industry expansion, although consumer demand growth remained strong.

Lower feed prices were expected to more than compensate for reduced selling prices.

Source: Finance24

3 May 2005