AVI Limited (JSE: AVI) presented its full‑year results for the fiscal year ended 30 June 2026 on 7 September 2026. Management described the performance as a "tale of two halves", noting a challenging second half marked by subdued consumer demand and unrest surrounding the national protest action on 30 June.
Shares reacted positively, gaining 2.66% to $28.82 after the presentation, still well below the 52‑week high of $52.42. The closing price on 30 June 2026 was R100.53, delivering a total dividend yield of 9.6% and a normal dividend yield of 6.6%.
Group revenue reached R16.24 billion, a modest 1.4% increase over the prior year. Operating profit rose 4.4% to R3.72 billion, lifting the operating margin to 22.9% from 22.2% in FY2025. Gross profit margin slipped slightly to 42.4% from 42.7%, while selling and administrative expenses fell 3.2% after restructuring measures. Headline earnings per share grew 5.3% to 767.9 cents, reflecting a 6.0% rise in absolute headline earnings.
The quarter‑four wholesale segment recorded a sales impact of roughly R91 million due to customer deferrals ahead of the protest action.
Segment highlights:
Entyce Beverages* – Revenue declined 2.5% to R5.16 billion and operating profit fell 3.4% to R1.56 billion, with the operating margin holding at 30.2%. Competition in the creamer category forced price cuts, and volumes of black tea and rooibos fell. Snackworks* – Revenue grew 1.9% to R5.72 billion, and operating profit increased 6.8% to R1.38 billion, expanding the margin to 24.2% from 23.1%. Gains stemmed from biscuit efficiency, restructuring savings of R66.3 million and product innovation, while snack profits were pressured by regional competition. I&J (Irvin & Johnson)* – Revenue surged 10.2% to R2.83 billion and operating profit jumped 32.1% to R318 million. The fishing operation’s profit rose 47.5% to R395.6 million, helped by a second‑hand freezer vessel, higher export prices and solid demand. The abalone business posted an operating loss after an R84 million non‑cash fair‑value adjustment. Personal Care (Indigo Brands)* – Revenue fell 5.1% to R877 million, but operating profit rose 2.7% to R160.9 million, lifting the margin to 18.3% from 17.0% thanks to fragrance‑driven demand and R9.8 million of restructuring savings. Footwear & Apparel* – Revenue increased 2.1% to R1.65 billion, with like‑for‑like sales up 8.3%. Operating profit grew 15.9% to R305.7 million. Trading density improved to R74,089 per square metre, the store base fell to 100 after closing Green Cross locations, and the online Spitz platform is slated for launch in October 2026.
Cash generation rose 10.6% to R4.41 billion, delivering a cash‑to‑EBITDA conversion of 101.8%. Net debt fell 26.4% to R1.67 billion, reducing the net‑debt‑to‑EBITDA ratio to 0.4x and the net‑debt‑to‑capital‑employed ratio to 22.1%. Return on average capital employed improved to 35.7%.
Capital expenditure for FY2026 was R387.2 million, down from R601 million the year before, with R169 million already spent on water and electricity backup infrastructure. Approved projects for FY2027 total R441 million, covering upgrades to coffee/creamer facilities, vessel dry‑docks, factory infrastructure and power‑backup systems.
Dividends were increased, with a final dividend of 418 cents per share and a normal dividend of 663 cents, a 5.9% year‑on‑year rise. The board also approved a special dividend of 300 cents, bringing total payouts to 963 cents per share. Over the past three years, AVI returned R8.3 billion to shareholders via dividends and buybacks, with R2.4 billion scheduled for October 2026. The present value of returns over 22 years, inflation‑adjusted, is estimated at R41.5 billion.
Restructuring delivered R110.3 million of savings in FY2026, split among Entyce and Snackworks (R66.3 million), Indigo (R9.8 million), Spitz (R25.1 million) and shared services (R9.1 million). An incremental benefit of R39.8 million is expected in FY2027. Price increases of R595 million across categories offset volume declines of R377 million, helping to preserve margins amid inflationary pressure.
