Pioneer Foods

Food group Pioneer Foods on Tuesday advised shareholders that headline earnings per share (HEPS) for the 12 months ended September 30 2009 are expected to be between 350c and 405c per share (2008: 292cps) or between 20% and 39% higher than the previous corresponding period. Earnings per share (EPS) are expected to between 315c and 370c (2008: 282c) or between 12% and 31% higher. The group said the difference between EPS and HEPS was mainly from the impairment of goodwill relating to a particular transaction and certain fixed assets. A fire occurred at the S.A.D raisin production facility in Upington in August 2009. A provision for loss of raisin stock of R48-mn is raised in terms of IAS 37 that prescribes the accounting treatment of provisions, contingent liabilities and contingent assets and is included in EPS and HEPS. This provision is expected to be reversed, possibly even before final approval of the full year results by the board, once the insurer acknowledges the insurance claim.

"The growth momentum of the 1st half accelerated slightly in the 2nd half with lower selling prices on average in the key pasta, rice, bread and wheaten products categories, compared to the previous year," said Pioneer. It noted that the deflationary effect of lower input costs and selling prices resulted in lower average inventory and debtor values compared to the previous corresponding period which contributed to better cash utilisation and lower financing costs.

The results for the 12 months ended September 30 2009 will be announced on or about November 30 2009.