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South Africa's AVI To Pay Special Dividend

By Steve Wynne-Jones
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South Africa's AVI To Pay Special Dividend

AVI, the South African maker of Five Roses tea and I&J frozen foods, will pay a special dividend of 2 rand ($0.17) a share for the fiscal first half after higher prices helped offset the weaker rand and boost profit.

The one-time payout is on top of a half-year dividend of 1.32 rand a share for the six months through December, 10 per cent higher than a year earlier, the Johannesburg-based company said in a statement on Monday. Headline earnings per share, which exclude one-time items, rose 9.7 per cent to 2.53 rand.

AVI raised prices “in all categories following significant accumulated cost pressure as a result of the weaker rand,” the company said. “We expect the current constrained consumer demand environment to persist.”

South African retailers struggled last year as strikes, unemployment of about 25 per cent and slowing economic growth hurt consumer spending. The rand traded an average 8.4 percent weaker against the dollar in the period from a year earlier, and fell to the weakest level in 13 years on Friday after better-than-expected US jobs data caused a sell-off in emerging market currencies.

Bloomberg News, edited by ESM

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