Trellidor Holdings’s revenue fell by 1 percent to R513 million in the year to June 30, and headline earnings per share plunged by 99 percent to 0.4 cents, its results showed yesterday.
Included in the results was a provision for the Labour Court judgment of R32m.
The group said household budgets were stretched and consumers traded down, resulting in lower demand for its higher-priced and premium products.
In addition, the subdued residential property market and increasing trend in estate living had a negative impact on sales of Trellidor’s traditional product.
Trellidor’s distribution was predominantly through a national network of 51 franchise owners, essentially small businesses.
The government’s response to the Covid-19 pandemic had a disproportionate negative impact on small businesses. The franchise network had reduced and had been slow to replace capacity lost during the pandemic.
Meanwhile, a significant reduction in gross margin was due to “rampant raw material and freight inflation”.
The board opted not to declare a dividend due to the weak operating environment and the possible further increase in debt which may be required to execute a Labour Court judgment, pending the Constitutional Court decision on further leave to appeal and any subsequent ruling.
BUSINESS REPORT