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Results For The Year Ended 31 December 2024 And Cash Dividend Declaration
Libstar Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 2014/032444/06)
(JSE share code: LBR)
(ISIN: ZAE000250239)
("Libstar" or the "Group")
RESULTS FOR THE YEAR ENDED 31 DECEMBER 2024 AND CASH DIVIDEND DECLARATION
INTRODUCTION - Continuing Operations*
Libstar's results for the year ended 31 December 2024 reflect both promising, sustainable successes
achieved from the execution of the Group's simplification, growth and sustainability strategy, as well as the
material impact of limited, yet notable, challenges.
The Group has made strong progress in executing in each of the three focus areas of its strategy, supported
by a strong performance of the Ambient Products category. However, this positive trajectory has been
tempered by the impact of the loss of significant production volumes related to a Food Service customer in
its Perishable Products category. While material, this challenge does not detract from the overall strategic
progress and resilience demonstrated by the Group.
The Ambient Products category outperformed, delivering revenue growth of 5.4%, marginally lower gross
profit margins of 25.5% (2023: 25.6%) and Normalised EBITDA growth of 12.2%.
The Group's Perishable Products category faced headwinds, reflected in revenue growth of 1.2%, a
reduction in gross profit margins to 16.1% (2023: 16.7%) and a reduction in Normalised EBITDA of 13.7%.
Libstar's cash conversion and interest cover ratio's improved which, together with proceeds raised from the
disposal of the Group's Chet Chemicals business, resulted in the achievement of the Group's 2024 leverage
target.
Against this backdrop, the salient features include:
• Revenue growth of 3.1% (Volumes -3.2%, Price mix +6.3%)
• Gross profit of 21.0% (2023: 21.3%)
• Normalised EBITDA of R974 million (2023: R974 million)
• Normalised HEPS of 53.4 (2023: 57.1)
• Gearing ratio of 1.5x Normalised EBITDA (ex-IFRS 16) (2023: 1.6x)
• Adjusted ROIC of 8.6% (2023: 9.8%)
• Cash dividend maintained at 15 cents per share (gross) (2023: 15 cents)
*It is important to note the Group's continuing operations result for the year under review is reported against
a prior period which has been restated due to the Chet Chemicals division being disposed of and
consequently classified as a discontinued operation.
RESULTS SUMMARY
The Group uses Normalised EBITDA, Normalised Earnings per Share (EPS) and Normalised Headline
Earnings per Share (HEPS) from continuing operations, which exclude non-recurring,
non-trading, and non-cash items, as the key measures to indicate its true operating performance.
Libstar's full-year results are summarised in the table below:
(R'000) 2024 % change 2023*^
Continuing operations
Total revenue 11 773 771 3,1% 11 418 919
Gross profit margin 21,0% -0.3pp 21,3%
Normalised operating profit 631 143 -6,3% 673 785
(margin) 5,4% 5,9%
Normalised EBITDA 974 143 0,0% 974 227
(margin) 8,3% 8,5%
Basic EPS (cents) -46,8 -225,5% 37,3
Basic HEPS (cents) 39,4 -16,2% 47,0
Normalised EPS (cents) -32,7 -185,2% 38,4
Normalised HEPS (cents) 53,4 -6,5% 57,1
Balance sheet and cash flow
indicators
Net interest-bearing debt to Normalised
1.5 1.6
EBITDA (excl. IFRS 16)
Cash generated from operating activities
983 427 -5.5% 1 040 136
(excl. net working capital)
Cash generated from operations (incl. net
794 410 3.7% 766 260
working capital)
Capital investment in property, plant and
195 164 -20.2% 244 647
equipment
Cash conversion ratio 80% 66%
* The results for Chet Chemicals are disclosed in the Group's discontinued operations for the year ended
31 December 2024. The comparative prior period statement of comprehensive income has been re-
presented to provide a like-for-like comparison.
^ Refer to note 34 in Annual Financial Statements for details on restatements in 2023.
Revenue
Libstar recorded 2024 revenue growth of 3.1%. Selling price inflation and mix changes contributed 6.3% to
sales growth. Sales volume declined by 3.2% as the Group experienced a decline in its Retail and Food
Service channels.
Gross Profit Margins
Libstar's year-on-year gross profit margin decreased from 21.3% in the prior year to 21.0% in the current
year. Margin pressures in the Dairy and Dry Condiments sub-categories, as well as the margin impact in
value-added meats impacted the Group margin.
Other Gains and Losses
Realised foreign currency translation losses of R37.1 million were recognised in the current year compared
to a R29.6 million loss in the prior year.
Unrealised foreign currency translation gains of R0.4 million were recognised compared to a R2.9 million
loss in the prior year.
Operating Expenses
Operating expenses increased by 7.0%, driven by higher consulting fees, reflecting the costs associated
with strategic initiatives such as operating model planning, the launch of the Group's One Libstar culture
program, and fees for divestment advisors. Additionally, salaries and wages increased, in line with CPI
adjustments and the filling of vacant positions compared to the previous period.
Libstar's expense margin increased to 17.2% (2023: 16.5%).
Capital Items
The Group received insurance proceeds of R120 million in the prior year relating to the Denny
Mushrooms (Shongweni plant) fire.
An impairment charge of R400 million net of tax was recognised in relation to the Finlar Fine Foods
business unit owing to the supplier diversification implemented by a major customer impacting beef
volumes in the Food Service channel. Additionally, an impairment charge of R98.2 million net of tax was
recognised in the Denny Mushrooms division to recognise the business unit at its recoverable value.
Customer relationships of R10.5 million net of tax were impaired due to the termination of customer
contracts in Dickon Hall Foods and Cape Herb and Spice.
The impairment charges decreased Total Diluted EPS and Normalised EPS, but are added back for
purposes of the calculation of Total Diluted HEPS and Normalised HEPS.
Normalised Operating Profit and Normalised EBITDA
Group Normalised operating profit decreased by 6.3% at a margin of 5.4% (2023: 5.9%).
During the prior year, the Group re-evaluated the estimated useful lives of assets with zero book value,
resulting in a decline in prior year depreciation of plant and equipment of 6.3% or R14 million. As the re-
evaluation only impacted the 2023 financial results, the 2024 year-to-date depreciation expense has
increased by 22.9% or R44 million relative to the prior corresponding period.
Group Normalised EBITDA was R974 million (2023: R974 million) at a margin of 8.3% (2023: 8.5%).
Investment Income and Finance Costs
The Group's net finance cost (including IFRS 16 lease liabilities) decreased by 1.6% from R213.7 million
to R210.4 million.
Group net finance costs on interest-bearing debt (excluding IFRS 16 lease liabilities), decreased by
13.7% from R165.5 million to R142.8 million, mainly due to the decrease in the Johannesburg interbank
average lending rate (JIBAR) in the current prior period.
Finance charges incurred on lease liabilities (IFRS 16) increased by 32.1% from R45.7 million to R60.4
million.
Taxation
The Group's effective tax rate of 10.7% (2023: 28.3%), is mainly a result of the impact of impairments on
intangible assets. The effective tax rate excluding the effect of impairments is 24.3% (2023: 24.9%).
Earnings and Headline Earnings
Total Diluted earnings per share (EPS) decreased from 38.0 cps to a loss per share of 54.0 cps. The
decrease is mainly attributable to higher impairment charges and lower insurance proceeds relative to the
prior year.
Total Diluted headline earnings per share (HEPS) decreased by 11.7% to 42.1 cps (2023: 47.7 cps). The
decrease is mainly attributable to the receipt of insurance proceeds in the prior year.
Normalised earnings from continued operations
Normalised EPS, which excludes insurance proceeds, unrealised foreign currency movements and other
non-recurring, non-trading, and non-cash items, decreased from 38.4 cps to a loss per share of 32.7 cps.
The reduction is mainly attributable to higher impairment charges relative to the prior year.
Normalised HEPS, which also excludes the aforementioned items, as well as insurance proceeds and
impairment charges, decreased by 6.5% from 57.1 cps to 53.4 cps.
The weighted average number of shares in issue remained unchanged at 595.8 million and is equal to the
diluted number of shares in issue.
Cash Flows and Balance Sheet
Cash generated from operating activities increased by R28.1 million from R766.3 million to R794.4 million.
Group net working capital increased to 19.1% of Group revenue (2023: 18.0%), resulting from an increase
in inventory days, mainly driven by excess milk volumes.
The Group target range is expected to remain elevated between 16% – 18% of revenue in the medium term
given continued shipment delays, and excess milk volumes.
The Group focused its capital allocation on capacity-enhancing projects in identified growth areas, critical
maintenance, and safety projects. Capital expenditure was reduced by R47.9 million to R195.2 million
(2023: R244.6 million), representing 1.7% of net revenue (2023: 2.1%). The Group's target range remains
between 2.0% to 3.0%.
The Group's EBITDA to term debt gearing ratio reduced to 1.5x (2023: 1.6x) normalised EBITDA within the
stated target of 1x to 2x.
Net interest cover to EBITDA remains strong at 5.4x from 4.9x in the prior year and compares favourably
to the Group's minimum stated target of greater than 3.5x.
OUTLOOK
Introduction
Consumers are expected to remain under pressure in the short to medium term, notwithstanding some
improving macro-economic indicators. Within this context, Libstar remains resolute in the execution of its
simplification, growth and sustainability strategy.
Portfolio and Operating Model Simplification
In the coming year, the Group's operating model will be further simplified within the Ambient Products
category, where a shared-services structure will be created in the Wet Condiments subcategory. This new
structure will consist of Montagu Foods, Dickon Hall Foods, Retailer Brands and Cecil Vinegar Works, with
the goal of improving operational capabilities while preserving the unique market positions of each business
unit.
Furthermore, as part of the Group's ongoing commitment to optimising our operational execution, the
divisions of Rialto (Retail Division), Ambassador Foods (Snacks Division) and Cape Coastal Honey
(Spreads Division) will be integrated in the coming year. The integration of these divisions into a newly
formed sub-category of the Ambient Products category, better positions the business for growth and
improves customer alignment. The integration will, furthermore, strengthen the categories' leadership
structure and succession planning, while simultaneously advancing technical and product development
capabilities.
Category and Channel Growth
The new financial year marks a special milestone for the Group as Libstar celebrates its 20 th anniversary–
a testament to the dedication, innovation, and resilience of the Company. Forming part of its revised
business strategy, Libstar's key focus for the year ahead will be on the achievement of category and channel
growth, the development and upliftment of its people and the continued strength of its culture.
Within the Perishable Products category, Libstar will continue to develop markets for its quality, value-
added meat products. The Group anticipates a more balanced supply-demand dynamic in the Dairy sub
category as industry-wide production and pricing pressures normalise. However, cost inflation in key inputs
such as feed, logistics and costs related to disease outbreaks remains a risk, requiring continued focus on
operational efficiency and procurement strategies. The Group will continue to invest in high-margin
categories, expanding its Soft Cheese and Yoghurt offerings.
The Ambient Products category remains well-positioned to benefit from the continued growth of its Exports
and Food Service offerings, supported by the operating model simplification aforementioned.
Unlocking Stakeholder Value
Although Libstar faced isolated challenges in 2024, the Group's broader performance and resilient balance
sheet reflects the strength of its strategy, and we remain confident in our long-term growth trajectory.
In light of the above, the Board believes the timing to be optimal for Libstar to assess further potential
strategies through which to deliver meaningful value unlock for stakeholders, alongside continued execution
of the Group's ongoing operational and strategic initiatives.
The evaluation of potential strategic options remains at an early stage. Shareholders will be kept informed
as the Company progresses its assessment, as appropriate and to the extent required in terms of the
applicable regulations.
Responsibility statement
This short-form announcement is the responsibility of the directors and is only a summary of the information
in the full announcement. Any investment decision should be based on the full announcement. The
information presented in the Results summary section above includes pro-forma financial information in
terms of the JSE Listings Requirements. The pro forma financial information presented in this
announcement, which is the responsibility of the Group's directors, has been prepared for illustrative
purposes only, and may not fairly present the Group's financial position, changes in equity, cash flows or
results of operations.
The full announcement can be found:
- On the JSE's website:
https://senspdf.jse.co.za/documents/2025/jse/isse/lbre/FY_2024.pdf
- On the Company's website:
https://www.libstar.co.za/wp-content/uploads/2025/03/SENS-Booklet-2024.pdf
A copy of the full announcement is available for inspection and may also be requested at Libstar's registered
office and offices of our sponsor, at no charge, during office hours.
Report of the independent auditors
The consolidated annual financial statements for the year ended 31 December 2024 have been audited
by Ernst & Young Inc., who expressed an unqualified opinion thereon. The auditor's report in terms of
International Standards on Auditing, along with their key audit matters and the Annual Financial
Statements, are available at the following link: https://www.libstar.co.za/wp-
content/uploads/2025/03/Annual-Financial-Statements-2024.pdf
DECLARATION OF CASH DIVIDEND
The Board of Libstar has approved payment of a cash dividend of 15 cents per ordinary share (gross) in
respect of the year ended 31 December 2024 (2023: 15 cents).
In accordance with paragraphs 11.17 (a) (i) to (ix) and 11.17 (c) of the JSE Listings Requirements, the
following additional information is disclosed:
• The dividend has been declared from income reserves.
• The local Dividends Tax rate is 20% (twenty percent).
• The gross local dividend amount is 15 cents per ordinary share for shareholders exempt from the
Dividends Tax.
• The net local dividend amount is 12 cents per ordinary share for shareholders liable to pay the
Dividends Tax.
• Libstar has 681 921 408 ordinary shares in issue.
• Libstar's income tax reference number is 9526395174.
The following salient dates will apply to the dividend payment:
• Declaration date Tuesday, 18 March 2025
• Last day to trade cum the dividend Tuesday, 8 April 2025
• Shares commence trading ex the dividend Wednesday, 9 April 2025
• Record date Friday, 11 April 2025
• Payment in respect of the dividend Monday, 14 April 2025
Share certificates may not be dematerialised or re-materialised between Wednesday, 9 April 2025 and
Friday, 11 April 2025, both days inclusive.
CHANGES TO THE BOARD
Wendy Luhabe will be stepping down as board member and Chairman of the Company after the AGM on
or about 30 May 2025. The Board would like to extend its sincere gratitude to Wendy for her invaluable
contributions to both the Board and the Company over the years.
JP Landman, current lead independent non-executive director, has been appointed as Chairman of the
Company with effect from the conclusion of the 2025 AGM. He will step down as the lead independent non-
executive director and member of the Audit and Risk Committee at the AGM.
By order of the Board
Wendy Luhabe CB de Villiers
CHAIRMAN CEO
18 March 2025
Sponsor
The Standard Bank of South Africa Limited
Date: 18-03-2025 09:40:00
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