Bidvest remains focused on expanding in Africa despite slow progress

Industrial conglomerate Bidvest on Monday said it remained focused on expanding its business in Africa, despite the slow progress it had made in that regard, and that alternative strategies to speed up penetration were being explored.

In its full-year results, the group said its southern African operations at Bidvest Food Africa had performed “relatively well” as many markets in its emerging market division had faced economic headwinds in the period under review.

In the year ended June 2015, emerging market turnover grew by 12.3 percent to R15.9bn with trading profit rising 2.9 percent to R655m compared with the year-earlier period.

In its South African division, Bidvest said results had been “satisfactory” with turnover 9.2 percent higher at R87.4bn.

“Plummeting commodity markets created challenges for freight while other operations faced low business and consumer confidence, with sectors such as mining, manufacturing and construction under particular pressure. Within this challenging context, several teams delivered impressive market share gains and solid growth. Innovation continues,” the company said.

Looking ahead, Bidvest said it had confidence in the business even with “the volatile and somewhat unpredictable economic conditions” it was experiencing in all the countries in which it operated.

“Trading conditions in SA are likely to remain tough in a low-growth environment but management see opportunity in the current market volatility. Certain divisions are being realigned to cater for succession and to streamline our service offering to customers”.

Bidvest said significant effort had been undertaken by Adcock management to reorganise and restructure the business. It said these corrective measures and actions had put Adcock on the path to improved profitability.

“Bidvest remains optimistic about the medium-term prospects; however, further work is still required for Adcock to reach its potential. Management remains focused on maximising returns in all our businesses,” the company said.