{"id":7817,"date":"2026-06-17T22:00:20","date_gmt":"2026-06-17T22:00:20","guid":{"rendered":"https:\/\/www.fintechpulse8.com\/?p=7817"},"modified":"2026-06-17T22:00:20","modified_gmt":"2026-06-17T22:00:20","slug":"theres-a-lot-of-opportunity-to-drive-costs-out-premier-ceo","status":"publish","type":"post","link":"https:\/\/www.fintechpulse8.com\/?p=7817","title":{"rendered":"\u2018There\u2019s a lot of opportunity to drive costs out\u2019 \u2013 Premier CEO"},"content":{"rendered":"<p><\/p>\n<div id=\"textFreeArticle\">\n<p><iframe loading=\"lazy\" src=\"https:\/\/iframe.iono.fm\/e\/1686899?layout=modern\" width=\"100%\" height=\"170\" frameborder=\"0\" data-mce-fragment=\"1\"><\/iframe><\/p>\n<p>You can also listen to this podcast on iono.fm here.<\/p>\n<p><strong>JIMMY MOYAHA: <\/strong>Premier Group, the business responsible for bringing us brands like Snowflake, Blue Ribbon and Rhodes Quality among others, released their full-year results for the financial year ended the 31st of March 2026.<\/p>\n<p>We\u2019re going to look at these numbers with the company\u2019s group chief executive officer, Kobus Gertenbach. He joins me on the line now to see what we make of their performance.<\/p>\n<p>Kobus, lovely having you on the show, as always. Thanks so much for taking the time.<\/p>\n<p>Revenue is strong \u2013 more than 5% growth in that respect. Earnings before interest and tax up as well. Operating profit up north of 20%. How did you and the team feel about the year that was? It seemed a good year by all accounts.<\/p>\n<p><strong>KOBUS GERTENBACH: <\/strong>Yes. I think, we benefitted from a cheaper maize price, but I think wheat prices pretty much went sideways. Not too much change there, but it enabled us to really have zero inflation in our portfolio for most of the year.<\/p>\n<p>So most of our revenue growth was driven by increases in volume \u2013 a very pleasing result for us that we managed to do that in difficult market conditions.<\/p>\n<p><strong>JIMMY MOYAHA: <\/strong>Kobus, let\u2019s look at some of those difficult market conditions, the business operating largely in the consumer space.<\/p>\n<p>But as a producer, as a retailer, as a wholesaler across many, many aspects of the business, take us through the Millbake business, take us through the groceries business. How did each of the divisions perform and where were those challenges that you alluded to?<\/p>\n<p><strong>KOBUS GERTENBACH: <\/strong>From our side, bread is the biggest business unit within our portfolio.<\/p>\n<div class=\"visible-sm-block visible-xs-block m1010\">\n<div class=\"ad-container-wrapper\">\n<p>ADVERTISEMENT<\/p>\n<p>CONTINUE READING BELOW<\/p>\n<\/div>\n<\/div>\n<blockquote>\n<p>We have continued to benefit significantly from the enormous investments that we made over the past few years.<\/p>\n<\/blockquote>\n<p>I think over the last four years, we\u2019ve invested almost R3 billion across our various manufacturing facilities, with the biggest portion of that going into our bakeries.<\/p>\n<p>Read: Premier lifts earnings, declares special dividend [Nov 2025]<\/p>\n<p>That culminated in us opening up our new Aeroton bakery in in January, after we shut it down in 2023. So it\u2019s taken us the better part of two-and-a-half years to complete and get that project off the ground.<\/p>\n<p>On the wheat-milling side, Snowflake continues to be a powerhouse brand, and we certainly have the best-selling cake flour on the market.<\/p>\n<p>On the maize meal side, we saw a nice downward trend in raw maize prices that came through. We pushed most of that through to the end consumer, and so the consumer really benefitted from much cheaper maize meal for the latter part of our financial year towards the end of March.<\/p>\n<p>On the sweet side, we\u2019ve grown our portfolio in products that we\u2019ve manufactured under private label for some of the larger retailers quite significantly, and have benefitted from the increasing scale of that.<\/p>\n<p>And on the feminine hygiene side, we put a lot of new factory capability into our factory in KZN, and started to manufacture a lot of the products that we used to import from outside the country \u2013 to manufacture that ourselves for the local market.<\/p>\n<blockquote>\n<p>These cost advantages and the scale of that manufacturing operation are really what we will also continue to benefit from going forward.<\/p>\n<\/blockquote>\n<p>So I think all in all across the various business units we\u2019ve continued to try to identify the right projects, make the right investments, and to drive our scale and our efficiency.<\/p>\n<div class=\"visible-sm-block visible-xs-block m1010\">\n<div class=\"ad-container-wrapper\">\n<p>ADVERTISEMENT:<\/p>\n<p>CONTINUE READING BELOW<\/p>\n<\/div>\n<\/div>\n<p><strong>JIMMY MOYAHA: <\/strong>Kobus, can we look at the obvious big news out of the Premier Group for this particular financial year? That is, finally getting the R6.5 billion\u00a0RFG [Rhodes Food Group] Holdings deal over the line?<\/p>\n<p>This is something that you and the team have been working on for quite some time. It is something that has been quite the priority since Premier\u2019s listing in bolstering the business in what you have. Take me through that acquisition, that transaction, and being able to conclude it within the financial year?<\/p>\n<p><strong>KOBUS GERTENBACH: <\/strong>Yes. I think the whole idea of combining their business into ours really sprung from the fact that they have a very well-established portfolio of extremely well-known brands. It has also been around for a very long time. They command a very strong market share in the different categories they play in.<\/p>\n<blockquote>\n<p>But, importantly, we didn\u2019t have a single product in our portfolio on which we were competing with each other. So that was 100% complementary.<\/p>\n<\/blockquote>\n<p>And the economies of scale from merchandising, distribution and the combination of the businesses really made sense for us to go through the transaction.<\/p>\n<p>As you say, it took us quite a while to get through the various approvals. We received Competition Commission approval on the 11th of March. That was the final condition of the transaction.<\/p>\n<p>And so, in our numbers, we have consolidated 21 days\u2019 worth of trading results from the RFG portfolio. It didn\u2019t really have any material impact on our performance for the year.<\/p>\n<p>Read\/listen:<\/p>\n<div class=\"ApplePlainTextBody\" dir=\"auto\">Premier launches share-swap takeover bid for RFG Holdings<\/div>\n<div class=\"ApplePlainTextBody\" dir=\"auto\">Premier Foods investments pay off as profit climbs 31% [Jun 2025]<\/div>\n<p>But we are well underway and the integration is going extremely well. We\u2019ve made good progress and we have multiple projects underway to start looking at driving the synergies through a combination of suppliers and combining different banking facilities, running one insurance portfolio, et cetera.<\/p>\n<p>So there is a lot of opportunity for us to continue to drive costs out between the two businesses.<\/p>\n<p><strong>JIMMY MOYAHA: <\/strong>Kobus, before I let you go, I want to look at that opportunity set, and perhaps what it looks like for the Premier Group going forward.<\/p>\n<p>The business is able to provide a cash dividend to shareholders this year, even though the acquisitions and the challenging environment going into the new financial year \u2013 which were already in the process.<\/p>\n<div class=\"visible-sm-block visible-xs-block m1010\">\n<div class=\"ad-container-wrapper\">\n<p>ADVERTISEMENT:<\/p>\n<p>CONTINUE READING BELOW<\/p>\n<\/p><\/div>\n<\/div>\n<p>How is the business approaching this? Are we still looking for complementary acquisitions, or are we looking to finalise integration and make sure that the business is streamlined where possible? How are you seeing your business, but also your environment?<\/p>\n<p><strong>KOBUS GERTENBACH: <\/strong>I think that our primary focus is on completing the integration of the two businesses. It\u2019s going to take another couple of months.<\/p>\n<p>On the 1st of July we\u2019re combining merchandising structures. On the 1st of October we will look to integrate some of the logistical sides of things. So there\u2019s a lot of focus on that. I think that as we learn more about the business and as we look at opportunities together there are lots of further opportunities for organic capital investment.<\/p>\n<blockquote>\n<p>And so we\u2019ve got a number of streams underway to look at those projects and identify the best and optimal way of continuing to invest for our growth.<\/p>\n<\/blockquote>\n<p>We did a share buyback in March. it\u2019s a general buyback; one is not allowed to buy back any shares during a closed period. Obviously we are out of that again now, so if we do have some further free cash coming available over the coming months, we\u2019d probably look to continue on our share buyback programme as well.<\/p>\n<p>And then, just given the growth in our earnings, we have a 30% of diluted earnings per share payout ratio on dividends. So if one continues to grow one\u2019s headline earnings per share, then there\u2019s quite a nice tick-up in the dividend payout as well.<\/p>\n<p>I think that\u2019s sort of the order of focus for us from a capital investment perspective.<\/p>\n<p><strong>JIMMY MOYAHA: <\/strong>A focus on growth, a focus on integration, and a focus on bringing all of this together in a single business. That\u2019s where the Premier Group Limited business is focused following its successful financial year.<\/p>\n<p>We\u2019ll leave the conversation on that note. Kobus Gertenbach, chief executive officer at Premier Group joined us to look at the year that was and what lies ahead.<\/p>\n<\/p><\/div>\n<p>#lot #opportunity #drive #costs #Premier #CEO<\/p>\n","protected":false},"excerpt":{"rendered":"<p>You can also listen to this podcast on iono.fm here. JIMMY MOYAHA: Premier Group, the business responsible for bringing us brands like Snowflake, Blue Ribbon and Rhodes Quality among others,&hellip; <\/p>\n","protected":false},"author":1,"featured_media":7818,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[369,449,1111,2300,2684,10045],"class_list":["post-7817","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing","tag-ceo","tag-costs","tag-drive","tag-lot","tag-opportunity","tag-premier"],"_links":{"self":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/7817","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7817"}],"version-history":[{"count":0,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/7817\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/media\/7818"}],"wp:attachment":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7817"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7817"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7817"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}