Libstar full-year revenue up 5.2%

Libstar, a food production company based in South Africa, has faced challenges in the past year due to rising finance costs and increasing pressure on consumers. In a recent interview with CNBC Africa, CEO Charl de Villiers discussed the impact of interest rate cuts on the company's operations and the implications of higher interest rates on their business. De Villiers highlighted the need to adapt to the evolving landscape by relooking and simplifying their operating model. The company reported a 5.2% increase in revenue, driven partly by price increases to offset rising costs. However, sales volumes were down, particularly in the retail channel, indicating continued pressure on consumers. Despite these challenges, Libstar saw an improvement in margins and revenue acceleration in three out of four channels. De Villiers also addressed issues related to inflation, noting that food inflation in their business exceeded national levels. Key input costs, such as raw milk, experienced significant inflation rates, leading to higher production costs. The CEO emphasized the need for efficiency to mitigate the impact of rising costs on consumers. The interview also touched on the unfortunate fire at Libstar's mushroom factory, which led to the decision not to rebuild the facility. Instead, the company will focus on improving production at its remaining facilities in the Western Cape and Gauteng regions. Regarding ongoing investigations into food prices by competition authorities, De Villiers refrained from commenting directly but highlighted how factors like load shedding had added operational costs for the company. Despite these challenges, Libstar remains focused on simplifying its operations, seeking cost efficiencies, and exploring growth opportunities in food service and export markets. Looking ahead, De Villiers emphasized the importance of sustaining margin improvements and developing markets to increase cost competitiveness and deliver better returns for stakeholders. Despite the uncertainties in the market, Libstar aims to navigate the challenges and drive growth in the coming year. In conclusion, despite facing various obstacles, Libstar remains committed to adapting to changing market conditions, optimizing its business operations, and providing value to its shareholders. The company's strategic focus on efficiency and market diversification positions it well to overcome the current challenges and achieve sustainable growth in the future.