BRAIT said yesterday it intended to list Premier, the largest unlisted consumer goods group in South Africa, this year. Picture: Timothy Bernard 13.01.2015
BRAIT said yesterday it intended to list Premier, the largest unlisted consumer goods group in South Africa, this year.
The Luxembourg-listed investment group with a secondary JSE listing owns 79.8 percent of Virgin Active, 98.5 percent of Premier and 18.3 percent of New Look in the UK. Brait moved its head-office from Malta to Mauritius late last year, and it’s £150 million (R3.06 billion) of bonds due on December 4, 2024 were dual listed on the Stock Exchange of Mauritius (SEM) on November 30.
One of the aims of the listing would be to reduce Brait’s gearing. In the six months to September 2021, Brait received R3.1bn from its portfolio since March 2020, but investments into Virgin Active as part of restructuring had resulted in Brait’s net debt increasing to R3.9bn.
Premier, formed as far back as 1820, is a leading fast-moving consumer goods manufacturer with well-known South African brands such as Snowflake (wheat flour), Iwisa No1, SuperSun and Nyala (maize meal), Blue Ribbon (bread), Lil-Lets (feminine products), Manhattan and Super C (sugar confectionary).
Its fleet of around 930 bakery trucks distributes some 34 000 bread deliveries a day, and it claims a 18.6 percent share of the formal bread market, with Tiger Brands holding 26.1 percent and Pioneer Foods holding a claimed 21.4 percent market share.
Some R500m is being invested into a new bakery and mill in Pretoria, due to be commissioned in the fourth quarter of 2022.
Brait said in an investor presentation that Premier had invested in advanced facilities and technology; it had experienced team leaders with a decade of investment in people and fostering strong corporate culture; and it held a market-leading brand portfolio, complemented by sustainable strategic private label partnerships.
Premier operates 30 manufacturing sites and 23 distribution depots.
Premier’s revenue and adjusted earnings before interest, tax, depreciation and amortisation (Ebitda) had grown at a compound average growth rate of 10 percent and 24 percent respectively, since 2011, Brait said.
In the past three years, the adjusted return on invested capital came to an average growth of 15 percent. Cash-flow generation was strong, with R1.8bn excess cash returned to Brait since 2011.
Brait said Premier faces inflationary cost pressures and commodity inflation this year, but countering these were recently announced price increases to maintain its targeted margins into the 2023 financial year.
Also demand for staple foods tended to strengthen in a weak consumer environment, which Premier was well positioned to supply during such times.
There would also be a full-year effect of the Mister Sweet acquisition, while planned cost-savings were on track.
The new Pretoria mill and bakery would lower the cost of servicing the inland region.
In the six months to September 2021, Premier Foods delivered 20 percent Ebitda growth off a strong earnings base in 2021, with strong contributions from all business units.
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