Tiger Brands FY25: Core profit surges and cash reserves soar as portfolio cleanup continues

Key topics:Record core performance: Profit hits R4.1bn; HEPS up to 2 056c; ROIC climbs to 19.1%.Massive cash build: R4.49bn net cash; major disposals fund huge dividends and buybacks.Risks remain: Discontinued units lose R243m; listeriosis litigation still unresolved.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here..BizNews Reporter.Tiger Brands has reported its strongest financial performance in years, posting a record profit from continuing operations and building a multibillion-rand cash pile through aggressive portfolio streamlining. The financial year to 30 September 2025 marks a turning point for the food producer, with a revitalised core business powering growth even as discontinued operations and legacy litigation continue to weigh on the group.Management said the year’s results reflect a business focused squarely on affordability, operational efficiency and disciplined capital allocation—core principles underpinning Tiger’s strategy to deliver quality essentials to millions across Southern Africa.Core operations deliver sharp turnaroundContinuing operations posted a major improvement across all key metrics. Operating income before impairments and non-operational items rose to R3.83 billion, up from R2.84 billion in 2024, while profit for the year increased to R4.09 billion, from R2.77 billion. Gross profit expanded to R10.77 billion, driven by firm demand in staple foods, cost control and enhanced manufacturing efficiencies.Headline earnings per share (HEPS) rose 15.4% to 2 056 cents, supported by a significant improvement in Return on Invested Capital, which increased from 14.7% to 19.1%.The strong performance was broad-based across Tiger’s four major continuing divisions:Milling & Baking: Operating income rose to R761 million (2024: R600 million).Grains (excl. Maize): Jumped to R736 million (from R219 million), reflecting improved pricing and operational fixes.Culinary: Increased to R1.07 billion (2024: R956 million).Snacks, Treats & Beverages: Grew to R820 million (2024: R721 million).Management said the growth reflects disciplined execution and the benefits of slimming down the portfolio to focus on profitable, scalable units.Portfolio disposals fuel massive cash buildA key feature of FY25 was the successful sale of non-core assets. The disposal of the Baby Wellbeing business and the group’s 24.38% stake in Chilean food producer Empresas Carozzi generated substantial liquidity. The Carozzi sale alone brought in R4.38 billion, including a R996 million profit.These transactions helped Tiger swing into a significant net cash position of R4.49 billion, compared with just R414 million a year earlier. This enabled the group to deliver extraordinary shareholder returns.Tiger declared total dividends of 5 570 cents per share, including a massive 3 926 cents in special dividends, returning excess disposal proceeds. It also repurchased 5.46 million shares during the year and an additional 4.35 million after year-end at a cost of R1.45 billion.Management indicated that further buybacks remain under consideration given the group’s strong cash generation, clean balance sheet and uplifted ROIC.Discontinued operations weigh on bottom lineWhile the core business surged, discontinued operations recorded a R243 million loss, compared with a R215 million profit in 2024. This reflects the heavy clean-up costs of exiting non-core and loss-making units.Maize Milling, classified as held for sale, recorded an operating loss of R132 million.Deciduous Fruit (LAF) and Chococam, also discontinued, delivered a combined loss before tax of R140 million, compared with R288 million profit in 2024.Loss on discontinuance across these businesses totalled R170 million.Management said the restructuring costs were expected and complete most of the group’s multiyear portfolio refocusing programme.Ongoing litigation risk: Listeriosis class actionThe listeriosis class action remains a significant uncertainty. Certified in 2018, the case continues through pre-trial processes, though settlement discussions are underway.Tiger’s product liability insurance is in place, but does not cover punitive or exemplary damages, creating the possibility of uninsured exposure. The group has provided interim relief payments to severely affected confirmed claimants but stresses these remain voluntary.OutlookTiger Brands exits FY25 with a strengthened core, a fortified balance sheet and sharply improved returns. But losses from discontinued operations and the unresolved litigation cloud an otherwise robust financial recovery. Management said the focus for FY26 will be on driving volume-led growth, further margin gains and disciplined capital deployment..Read the results in full by downloading the PDF below

Tiger Brands FY25: Core profit surges and cash reserves soar as portfolio cleanup continues

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