Bidcorp, the global food services company spun off from Bidvest in 2016, has held onto its interim dividend after a good start to its half year was derailed by another wave Covid-19 infections.
The group, which delivers to the food services industry, said it remains optimistic about its markets bouncing back, after seeing pressure in the UK and Europe towards the end of 2020.
Headline earnings from continuing operations fell 46.2% to R1.31bn in the six months to end-December, while revenue fell 10.9% to R60.76bn, with Covid-19 still applying pressure, particularly on businesses reliant on large crowds.
Group sales to end-December, in constant-currency terms, reached 87% of the comparative period for the week of August 2, but declined to a low of 68% versus the corresponding week of November 29, the group said.
Particularly hard hit were sales in Europe and the UK in the second quarter, which tracked at about 41% of the comparative prior year level as the second wave took hold in the northern hemisphere.
The UK generated just over a fifth of group revenue, and saw revenue decline 23.5% and trading profit 67.5%. Europe, almost a third of group sales, saw revenue fall 15.2% and trading profit 60.9%.
Australia, New Zealand and Asia performed well, growing both revenue and trading profit, which Bidcorp said gives it confidence markets will bounce back quickly once lockdown restrictions ease. That market grew revenue 5.2% and trading profit 7.1%, generating about half of the group’s R2.24bn in trading profit.
Bidcorp said that where lockdown restrictions have been eased it has seen demand in discretionary spending recover. However, any customers’ businesses associated with large crowds, such as entertainment, sports events, conventions and the cruise line industry, remain largely shuttered.
Non-discretionary demand from the group’s institutional customers including hospitals, aged care, prisons, military, and government departments has remained stable but below pre-Covid-19 levels, the group said.
In morning trade Bidcorp’s share was up 1.31% to R291.71, having recovered 10.9% so far in 2021, but having fallen 7.77% over the past 12 months.