AVI (AVI) H1 2026 earnings summary

Executive summary

• Achieved solid profit growth and robust cash generation despite a challenging South African consumer environment, with group revenue up 4.9% and operating profit up 11.6% year-over-year.

• Innovation, restructuring, and disciplined capital allocation contributed to improved profitability, margin protection, and sustained return on capital employed.

• Interim dividend increased by 11.4% to 245 cents per share, aligned with headline earnings growth.

• Net debt reduced to ZAR 2.1 billion, with net debt to capital employed at 27.8%.

• Cash to EBITDA conversion reached 95.6%, reflecting strong operational cash flow.

Financial highlights

• Revenue: R8,883.2m (+4.9% YoY); Operating profit: R2,193.7m (+11.6% YoY); Gross profit: R3,865.0m (+6.3% YoY).

• Gross profit margin improved to 43.5% (up from 42.9% YoY), supported by I&J's earnings recovery.

• Headline earnings rose 12.3%, headline EPS up 11.7% to 455.1 cents, and basic EPS up 10.6%.

• Cash generated by operations increased 9.8% to R2,366.7m.

• Dividend per share increased to ZAR 2.45, maintaining historical cover.

Outlook and guidance

• Trading environment expected to remain difficult with subdued growth and persistent consumer pressure.

• Moderation in some commodity costs and a stronger Rand may support lower inflation, but volatility and geopolitical risks remain.

• Continued focus on cost control, innovation, and efficiency to support margins and profitability.

• I&J's outlook depends on fishing performance, fuel prices, and exchange rates; abalone recovery remains uncertain.

• CapEx of just under ZAR 500 million planned for H2, targeting efficiency and infrastructure resilience.