Bidvest profits despite fishing and commercial hurdles

WINDHOEKDENVER ISAACS The South African-headquartered services and trading company Bidvest Namibia has expressed satisfaction with its latest financial results in Namibia, despite acknowledging a year filled with challenges. At group level, the Namibia Stock Exchange-listed fishing and commercial services group announced a 22,9% increase in local revenues in 2013, to N$3,4 billion compared to N$2,7 billion last year. However, operating profits for the year ended 8,1% lower than last year, reaching N$601,8 million comprared to N$654,5 million in 2012, attributed to what the company said were “adverse challenges” to both its fishing operations and commercial businesses. “In the context of the greater scheme of fishing quota allocations and further Namibianisation granted by the Ministry of Fisheries and Marine Resources, the result is credible,” Bidvest Namibia CEO Sebby Kankondi said, conceding that the division's performance was somewhat below expectation. Poor fishing conditions and challenging shareholder relationships in Angola hampered performance there, Kankondi said, while the company's Minolco and Kolok brands were also said to have underperformed in the year. Despite lower harvest volumes in its fishing division, Kankondi said the US dollar exchange rate fluctuation with the rand, as well as the strengthening of international prices for mackerel and pilchards, helped cushion the impact of the lower quota allocation. As for its food and distribution subdivision, Kankondi said it also performed lower than expected due to “margin pressures and dislocation of the poultry market” ahead of government's expected introduction of legislation to protect local poultry producers. “This resulted in an increase of poultry prices, prompting consumers to seek more affordable types of protein. In turn, this supports the demand for horse mackerel and creates opportunities for new product development for the local market,” he said. The subdivision, he said, was affected by disappointing results from Caterplus, as well as lower than projected results at Taeuber & Corssen (T&C), which it acquired in 2011. “On the positive side, T&C's facilities and its national footprint has created opportunities for synergies and efficiencies, which are being vigorously pursued,” he said. On the upside, he said the Group's Freight and Logistics subdivision, Manica, performed well on the back of an expansion drive to provide a full scope of logistics to the country's budding oil and gas exploration industry. “With the expected national GDP growth of close to 4% in the coming year, Bidvest Namibia is confident that sustained growth in revenue and trading profit will be achieved. We have a strong balance sheet and considerable capital resources. We are an acquisitive company and will continue to examine opportunities for acquisitive growth where we see value, potential for synergies and opportunities to expand on products and services offering,” Kankondi said.