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Bidfood Emerging Markets
These businesses continue to deliver
commendable results. Revenue moved 5,9%
to R19,3 billion (PF2016: R18,2 billion), with trading
profit up 18,1% at R1,1 billion (PF2016: R0,9 billion).
Excluding currency effects, profitability is up
20,8%.
Product segmentation Market segmentation
2017
2017
Frozen
Chilled
Ambient
Non-food
2017
39%
25%
32%
4%
2016
42%
24%
30%
4%
Logistics
Chain
Independent
Retail/other
2017
0%
28%
59%
13%
2016
0%
28%
58%
14%
Trading profit
R1,1bn
2016: R0,9bn*
Revenue
R19,3bn
2016: R18,2bn*
Bidcorp Food Africa (BFA)
recorded
excellent results, despite low South African
growth and pressure on consumers.
Net revenue growth of 10% was driven
by strong penetration of the independent
channel by Bidfood SA (BF) and Crown
Food Group (CFG). Trading profit was up by
23,8%, reflecting improved trading margin.
With effect from April 1st, 50% of Bidvest
Bakery Solutions was sold to Puratos
NV, a European supplier of bakery and
confectionary ingredients. The company,
renamed Chipkins Puratos (CP), was equity
accounted post the sale.
BFA’s focus on its own manufactured
products yielded positive results. Return on
average funds employed increased and net
working capital days improved. Cash flow
from operations improved substantially.
Investment continued into delivery
vehicles, manufacturing facilities and
new distribution centres. Investment in IT
system development tools and business
collaboration systems is ongoing.
BF recorded excellent results, achieving the
target of double-digit independent channel
growth following the deployment of additional
sales staff. BF’s online ordering platform,
BFS247, continues to grow. Channel growth
was assisted by increased private label
product sales. National accounts growth was
also achieved. However, challenges persisted
in the industrial caterers’ channel.
CFG’s sales dipped marginally in a
challenging trading environment. However,
the trading margin showed some
improvement, procurement savings were
secured and a change in the customer mix
proved beneficial. Pressure was significant
in the additives and spices category, but
good growth was seen in condiments, while
volumes increased significantly in the natural
casings category.
At year-end, a joint venture agreement was
finalised between CFG and Griffith Foods, a
US-based supplier of ingredients solutions,
to focus on a niche segment.
CP put in a strong performance, driven by
innovation and successful initiatives with
own-manufactured products. Strong growth
was achieved in the retail and supermarket
sector. The wholesale bakery category also
grew.
Angliss Asia
delivered a strong finish.
Substantial contributions from mainland
operations underpinned a highly satisfactory
performance, with trading profit well above
prior year. Double-digit revenue growth was
broadly in line with expectation. Operational
expenses remained high. Working capital
was impacted by much tighter supplier terms
on imported products, longer lead times and
revenue growth.
Continued growth is forecast, driven by
innovation and new product introductions.
Hong Kong
revenue was well up on 2016.
However, trading profits failed to meet
expectation.
Results at the core Angliss Hong Kong
foodservice business were impacted by rising
costs and the need for further investment
in warehousing capacity. The Him Kee dry
goods business delivered solid growth. Sales
at the PastryGlobal bakery and confectionary
business were constrained by delayed
shipments from European suppliers, but the
strong profit-line was maintained.
Trading profit also exceeded budget at
Gourmet Cuisine. Miumi, our Japanese foods
business, witnessed continued strong growth
of its Sabu Sabu line and frozen meat, frozen
sashimi, meat and seafood. Nature and
Organic Global gained further momentum,
driven by growing sales of frozen foods.
Good sales of Ready-To-Eat processed
products drove continued growth at the
Macau operation.
Mainland China
achieved good volume
growth in Shanghai driven by robust demand
from hotel and restaurant customers. Sales
were strong in second tier cities in Jiangsu
and Zhejiang provinces. Beijing’s pastry
volumes showed good growth. Beijing results
were also assisted by pleasing contributions
from second-tier regions such as Shenyang,
Shijiazhuang and Shanxi province.
Guangzhou put in another strong
performance, bolstered by buoyant bakery
and retail demand. Its Chengdu operation
* Pro forma revenue
* Pro forma trading profit.
DIVISIONAL REVIEWS
Annual integrated report 2017
Bid Corporation Limited
36