Tiger Brands, the South Africa-based food group, has said it expects half-year earnings to fall by as much as 36%.

In a trading update for the six months ending 31 March issued yesterday (12 February), the Jungle Oats and Tastic Rice brands owner said it predicts headline earnings per share from continuing operations will be at least 36% lower than the ZAR864 cents (US$0.58) reported for the same period last year.

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It said its bakery and pasta business faced pricing pressures, while a legal dispute with a former distributor in Nigeria has stopped it from exporting to that country.

Tiger Brands’ share price fell to its lowest level in more than eight years following the announcement, which comes just weeks after Noel Doyle took over as the company’s CEO.

The business, which is is due to report half-year results on 25 May, said it expects difficult trading conditions to continue in the second quarter of its financial year running January to March.

It added: “The performance of the export division will continue to be affected by the aforesaid legal dispute in Nigeria. A court hearing on the matter was held at the end of January but was adjourned to mid-March 2020 to allow the parties more time to amicably resolve the matter. However, a resolution, if reached, is unlikely to have a positive effect on trading in the second quarter.”

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Tiger Brands is also embroiled in legal proceedings linked to a 2018 listeriosis outbreak, which killed more than 200 people in South Africa and was traced back to a factory operated by Tiger Brands-owned Enterprise Foods.

The outbreak forced Tiger Brands to recall cold meat products such as polony and suspend operations at its facilities, which have since reopened.

The company faces a class action lawsuit over its role in the outbreak.