Johannesburg - Clover Industries, South Africa’s biggest dairy processor, will use a new supply agreement for Red Bull and its cold-distribution business to revive fiscal second-half earnings after profit slumped.
The company began distribution of Red Bull energy drinks on March 1 and will start to sell Enterprise Foods products in June, chief executive Johann Vorster said today by telephone.
Clover is seeking to restore earnings growth after first-half profit was dragged down by higher costs for fuel and marketing.
The Johannesburg-based company is counting on its so-called cold chain, the largest in South Africa, to drive profit.
Earnings excluding one-time items declined 34 percent to 38 South African cents a share in the six months through December, Clover said in a statement.
Sales rose 11 percent to 3.98 billion rand ($436 million).
Fresh milk consumption in Africa’s largest economy contracted 3.1 percent in 2012, while demand for long-life milk grew 7.5 percent, according to Clover. - Bloomberg News