Clover caught between drought and embattled consumers
Dairy products group says rising raw milk prices and constrained consumers put it under pressure during the first half of its financial year Dairy products group Clover complained that it was squeezed between the rising raw milk prices due to the drought and consumers unable to afford higher food prices during the first half of its financial year.
The group reported overall revenue grew 2.1% to R5.1bn while aftertax profit declined 9.6% to R198m for the six months to end-December.
Clover offered its shareholders the choice of receiving a 24.21c cash dividend — maintained at the same level as in its 2015 interim results — or the equivalent in shares.
Clover’s raw milk sales nearly halved to R7.76m from R13.48m in the matching period.
Total production during 2016 is estimated to have been 1.4% less than during 2015," Vorster said.
DFSA will initially be a wholly owned subsidiary of Clover, but it intends to broaden its ownership in due course.
Clover will purchase milk from DFSA at the average national milk price at which DFSA purchases the raw milk from producers.
This should result in the unfounded speculation that Clover is favouring profitability over the interest of producers (and vice versa) being dispelled," Clover said in January.
To reduce its dependance on dairy products, Clover acquired 51% of an olive oil and balsamic vinegar producer from AECI.
Competition authorities had approved the deal, which was expected to be concluded on April 1, Clover said on Wednesday.