Food services company Bidcorp said on Monday it expects earnings to lift by about a fifth in its six months to end-December, as it recovers from writedowns related to its exit from its UK transport businesses.
Bidcorp, which separated from Bidvest and listed on the JSE in May 2016, expects basic earnings per share to rise as much as 22% to 685.8c due to capital write-offs from discontinued operations in the previous comparative period. Bidcorp did not go into details in its trading update on Monday, but it reported an intangible asset impairment of £25.3m related to its UK PCL dairy distribution business in its half year to end-December 2018.Bidcorp had classified all its UK Logistics’ activities as discontinued.
For PCL, Bidcorp has said that low revenue increases, higher distribution costs and a dispute on transport rates affected profitability. The company has described its relationship with dairy firm Arla, to whom it distributed, as “severely strained” after a dispute regarding transport rates, and subsequently sold the distribution business to Arla in April 2019.