November 29, 2016 / 9:50 AM / a year ago

Southern African drought hurts Omnia's first-half profit

JOHANNESBURG, Nov 29 (Reuters) - South African chemicals and fertiliser maker Omnia Holdings reported a 25 percent drop in half-year profit on Tuesday hit by slack demand for some core products due to drought and weak economic growth.

Omnia, which makes fertilizers, mining explosives and chemicals used in manufacturing, said headline earnings per share (EPS) came in at 371 South African cents in the six months ended September, compared with 494 cents a year earlier.

Headline EPS is the main profit measure used in South Africa that strips out certain one-off times.

Omnia also cut its interim dividend payout by 11 percent to 160 cents per share. Its shares tumbled 3.6 percent to 152.67 rand as of 0903 GMT.

“We have had an immense drought for the last 18 months so clearly the farmers are a bit more conservative waiting for the rain,” Omnia Chief Executive Officer Rod Humphris told Reuters.

An El Nino weather pattern, which ended in May, triggered drought conditions across the southern African region, hitting the staple, maize, and other crops and denting demand for fertilisers.

Omnia’s first-half revenue rose 2.5 percent to 7.9 billion rand ($566 million) as a strong showing in its mining explosives unit offset declining sales in its chemicals and agriculture divisions. ($1 = 13.9560 rand) (Reporting by Tanisha Heiberg; Editing by Susan Fenton)

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