February 28, 2018
Honey Bun (1982) Limited’s Annual General Meeting was held today, the 28th of February 2018. The meeting started off with a tribute to the late great Sushil Jain who passed away in the latter part of 2017. After paying his respect, Chairman Herbert Chong reiterated some of the financial highlights of the financial year ended September 30, 2017. According to Mr. Chong “ revenue showed a 5% increase to $1.25 billion while pre-tax profit decreased by 30% to $105 million for 2017 period.” Herbert Chong further stated that, “ During 2016, Honey Bun’s capacity was maximized after unplanned increase of over 34%.” However, the chairman was quick to point out that measures are currently being put in place to address this problem. A ten thousand sq ft pre-fabricated steel building that will be used for warehouse purposes is currently on the verge of completion. The cost of expansion is approximately $130 million; Honey bun used $30 million of debt to fund the project.
With this additional capacity, Honey Bun (1982) intends to add new products to its product line. Michelle Chong, CEO, hinted at future plans for the company going forward, “There are plans for three new products for 2018 with the first to launch in the first quarter”. ‘Goodie’, a jelly-filled cupcake that was introduced to the market in 2017 is said to be doing extremely well. According to Mrs. Chong, “Our strategy moving forward is to continuously build on our capacity, improve our efficiency and continue to invest in technology as our foundation for growth”.
On the other hand, net profit fell for 2017 financial year. This deterioration of the company’s net profit was exaggerated by income tax charges. As stated by Michelle Chong, “for the financial period 2017 the 100% tax remission for the first five years after listing on the JSE expired on June 2, 2016 and the company was subject to income tax on 50% of its chargeable income for another five years.”
On the positive side, Honey Bun (1982) capped a number of awards at the JSE award ceremony for Best Practice. The following awards were received in 2017:
- JSE 2016 Governor General Overall Best Junior Market Company Award.
- JSE 2016 Best Practice Award for Corporate Disclosure and Investor Relations
- JSE 2016 PSOJ Award for Corporate Governance.
It is necessary to note that Honey Bun (1982) Limited is the first and only Junior Market company to have ever won the award for best corporate governance.
Honey Bun (1982) Limited is a certified food safety awardee; the company is committed to the reduction of Carbon footprint and the elimination of bleach flour in its products. The company is also determined to remove other colouring substances that are banned in other countries.
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