Bidcorp FY24 HEPS up 15.5%

Food services company Bidcorp has announced a 15.5 per cent increase in full-year earnings, attributing the growth to higher sales despite challenging operating conditions. The company, which was spun off from Bidvest in 2016, also saw a 15.9 per cent surge in group trading profit and declared a final dividend of 565 cents per share, marking a significant 16 per cent increase. David Cleasby, the Chief Financial Officer at Bidcorp, expressed satisfaction with the performance of the business amidst tough economic conditions globally. Cleasby highlighted the resilience of Bidcorp's management teams in navigating through volatile environments and capitalizing on opportunities. In terms of regional performance, while some markets faced macroeconomic challenges, the South African business stood out with its strong results. Cleasby credited the success in South Africa to the adeptness of the local management team in capitalizing on volatile conditions. He acknowledged the wage pressures arising from labor shortages, an issue prevalent in several geographies, but expressed optimism that the labor supply-demand equation would eventually balance out, alleviating the wage pressure. Discussing consumer sentiment, Cleasby noted that high interest rates globally have put pressure on consumer spending across various regions, impacting businesses like Bidcorp indirectly through their client base in the Horeca market (hotels, restaurants, and caterers). While challenges persist with consumers withholding spending, Bidcorp aims to increase market share and expand its client base as strategies to drive growth. The company remains cautious yet opportunistic in its approach to acquisitions, with a focus on new territories and products to enhance its existing network. Looking ahead, Bidcorp is focused on maintaining its strategic trajectory, with an emphasis on nurturing mature businesses with strong margins while accelerating the growth of smaller entities. Cleasby reiterated the importance of scaling up R&D businesses to bolster their contribution to the overall group performance. The company remains vigilant in identifying and evaluating acquisition opportunities that align with its growth strategy. In conclusion, Bidcorp's robust financial performance amidst a challenging operating environment underscores the company's resilience and strategic focus. With a keen eye on market dynamics and growth opportunities, Bidcorp is poised to leverage its financial strength and operational expertise to drive continued success in the global food services industry.