May 20, 2019 / 8:14 AM / 6 months ago

UPDATE 1-South Africa's Pioneer Foods H1 earnings down on maize shortfall

(Adds comment, outlook, share fall)

JOHANNESBURG, May 20 (Reuters) - South Africa’s Pioneer Food Group reported a decline in half-year earnings on Monday, driven down by maize shortages, sending its shares down more than 8 percent.

The food and drinks company, which uses maize in many of its products, said it was unable to counter the shortfall.

“The year-on-year regression in the performance of the maize category, off the strong comparative period base, was more than expected, given sustained selling price deflation despite raw material cost inflation and a weaker milling performance,” it said.

At 0800 GMT, the company’s share price was down 8.660 percent to 75.87 rand.

Pioneer said continued economic weakness will put pressure on consumer spending.

Diluted adjusted headline earnings per share (HEPS) for the six months ended March 31 fell 14% to 272.4 cents from 320 cents a year earlier, the food and beverage company said.

HEPS is the main profit measure used in South Africa, which strips out once-off items.

Pioneer, which also operates in Britain, said earlier this year that the business was doing well despite Brexit tensions.

The food company’s revenue rose 11.5% to 11.039 billion rand ($768.20 million), driven by growth in bread, wheat, rice, beverages, cereals and sausage rolls in Nigeria.

Pioneer issued a dividend of 105 cents per share for the six month ended 31 March 2019. ($1 = 14.3700 rand) (Reporting by Onke Ngcuka, editing by Louise Heavens)

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