Food investor back in the black
Veritas will book after-tax losses of between $2.2 million and $2.6 million on the sale of its upmarket Nosh supermarkets in its annual accounts, which it anticipates will bolster underlying earnings for the year, having returned to the black in the first half. The shares gained.
The food and beverage investor completed the sale of its Nosh franchise to Gosh Holding on Feb. 24, with the net proceeds going towards repaying bank debt, which was sitting at $30.5 million as at Dec. 31. The $3.98 million sale included about $1 million of stock, and let Veritas exit what’s been a problematic investment since buying the supermarket business in 2014. Veritas valued Nosh’s assets at $7 million with $2.6 million of liabilities at the Dec. 31 balance date.
Net revenue for the period was $15,912,862 compared to $19,133,865 in the six months to 31 December 2015, a decrease of 17 per cent, “due to the closure of a number of underperforming Mad Butcher stores and the sale of three bars in Hamilton”.
The Mad Butcher brand continued to be a major contributor to Veritas’ profitability generating EBITDA of $2,132,915 in the period compared to $1,916,933 in the previous corresponding period.
There are currently 32 Mad Butcher stores, 29 of which are franchised and three are company owned.
Veritas said the sale of Nosh meant its board is restating the guidance for the full year to Revenue of $26m – $31m, EBITDA of $7.9m – $8.5m and Underlying NPAT of $3.7m – $4.3m for FY17.
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