CEO of South African conglomerate Bidvest to step down after food business spin-off (thecasualobserver)
The founder and chief executive of South African conglomerate Bidvest Group, Brian Joffe, said on Monday he will step down as CEO after a deal to spin off its food business is finalised.
Joffe, who founded the company in 1988 and has been chief executive since 2004, is 68 and has been easing his workload in recent years. He will be replaced as CEO of what remains of the group after the spin-off by Lindsay Ralphs, who heads Bidvest’s South African unit.
“I think it is no secret to any of you here that I am old, you can see it, because I am old,” Joffe said at the company’s results presentation.
“I will continue in South Africa as a director and in some executive role to deal with the strategic issues in acquisitions.”
Bidvest, whose business spans pharmaceuticals, car showrooms, shipping and catering, announced this month it planned to spin off and separately list its food business, its biggest division, in Johannesburg. It had previously said the business should be separated because its value was not reflected in the company’s share price.
Joffe said he hoped the spin off would be completed by the time of the company’s next results presentation, which is due in six months’ time.
Bernard Berson will remain head of the food services business after it is spun off, the company said.
Joffe also said the group could list the food service business outside South Africa but that would be in the medium term.
Bidvest has tried spinning off the food services unit twice before.
The division, which contributed over half of the company’s sales of 200 billion rand ($12.5 bln) last year, supplies pubs, restaurants and hotels in Europe, South America and Asia.
The group’s diluted headline earnings per share rose 13.1 percent to 1,001.5 cents in the six months to end-December, helped by depreciation of the South African rand, which lifted its overseas earnings when converted into rand.
“Obviously the exchange rate flatters the numbers,” said Berson.
Bidvest said the average rand exchange rate weakened against sterling and the euro, resulting in a 3.7 percent benefit to trading profit.
Headline EPS is the main profit gauge in South Africa and strips out certain one-off items.
The group said tough trading conditions at home, where sales grew by only 3 percent, weighed on its results, but its food services business showed exceptional growth in Britain, Europe and some of China’s large cities.
Bidvest shares were down 0.3 percent by 1102 GMT.
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