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NOURISH AND
NURTURE
MORE LIVES
EVERYDAY
INTEGRATED ANNUAL
REPORT 2022
w w w.tigerbrands.com
WHO WE ARE
Tiger Brands is one
of Africa’s largest
listed manufacturers
of fast-moving consumer
goods (FMCG). Our
core business is the
manufacture, marketing
and distribution of
everyday branded
food and beverages.
Our products are relevant
across every meal occasion
and are well-positioned to grow.
The portfolio also includes leading
brands in the home and personal
care segments and we have a
growing presence in Africa.
OUR VISION
To deliver top-tier financial results
and be recognised by all
stakeholders as the pre-eminent
fast-moving consumer goods
(FMCG) company in South Africa
and the most desirable growth
company on the continent.
OUR PURPOSE
We nourish and nurture
more lives every day.
OUR STRATEGY
Our strategy for sustainable profitable growth is supported by six strategic pillars,
underpinned by our core values.
Building a
growth pipeline
Meeting the needs
of the consumer
Optimising
our supply chain
Being obsessed
about cost savings
and efficiencies
Igniting
our people
Investing in a
sustainable future
OUR VALUES
We treat each other with
care and respect
We deliver with passion
and excellence
Safety and quality are
non-negotiable for us
We embrace diversity
and inclusivity
We act with integrity and
accountability in all we do
WINNING BEHAVIOURS
Consumer obsession
Teamwork
Empowered accountability
Focused execution
www.tigerbrands.com
CONTENTS
OVERVIEW
About this report
Our value contribution in 2022
Our investment case
OUR BUSINESS
Group profile
Our board
Our exco
Chairman’s review
Chief executive officer’s review
Our business model
How we sustain value
OUR OPERATING CONTEXT
Our operating environment
Our key relationships
Material risks and opportunities
OUR STRATEGY
Building a growth pipeline
Meeting the needs of consumers
Optimising our supply chain
Being obsessed about cost savings and efficiency
Igniting our people
Investing in a sustainable future
2
4
6
8
10
12
14
17
20
22
24
27
31
38
41
43
46
48
51
OUR PERFORMANCE
Chief financial officer’s review
Grains
Consumer Brands*
Home and Personal Care (HPC)
Exports and International
OUR GOVERNANCE
Protecting value through good governance
Remuneration and performance
Declaration of final dividend
Company information
HOW TO NAVIGATE
THE REPORT
Reference to further online disclosure
Further reading in the sustainability report
Jump to page within document
United Nations Sustainable Development Goals (UN SDGs)
The UN SDGs set a long-term agenda to end poverty, protect the planet and ensure
prosperity for all by 2030. In fulfilling our core purpose – to nourish and nurture more
lives every day – Tiger Brands is committed to playing its role in delivering on these
goals. As part of our strategic commitment to a sustainable future
page 51, we have
developed a set of commitments and targets relating to three key focus areas: health
and nutrition, enhanced livelihoods and environmental stewardship. In meeting these
commitments and targets we believe we will provide a meaningful contribution to the
following eleven SDGs: Our approach to responding to these goals is reviewed in more
detail in our accompanying sustainability report 2022, which reviews Tiger Brands’
material impacts on people, society and the environment.
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1
Tiger Brands Limited Integrated annual report 2022 ABOUT THIS REPORT
Report purpose and audience
Tiger Brands’ integrated annual report
(IR) is our primary annual report. Written
primarily for investors and other
providers of financial capital, the report
is intended to be of value to any
stakeholder who has an interest in our
ability to create value over the short,
medium and long term. The report
reviews Tiger Brands’ business model
and strategy, the risks and opportunities
in our operating environment, and our
operational and governance
performance for the financial year
ended 30 September 2022.
By providing a frank review of our
strategy, governance and performance,
the report intends to help report-users
to assess whether Tiger Brands is a
good long-term investment. The IR
should be read in conjunction with our
supplementary sustainability report (SR)
and our annual financial statements
(AFS), all of which are available on
our website:
www.tigerbrands.com
Reporting frameworks
Our reporting process has been guided
by the principles and requirements
contained in the International Financial
Reporting Standards (IFRS) (including
the July 2022 Exposure Drafts released
by the International Sustainability
Standards Board), the International
Framework, the King Code
on Corporate Governance 2016
(King IVTM*), the JSE Listings
Requirements, the South African
Companies Act, No 71 of 2008,
and the GRI Sustainability Reporting
Standards.
Combined assurance
Combined assurance refers to the
incorporation of all assurance services
and activities to optimise our risk and
governance oversight function within
our risk appetite. All assurance
providers co-ordinate efforts and
reporting, ensuring alignment of
governance and risk activities with
the company strategy and improved
business performance. The board audit
and risk, and sustainability committees
are responsible for overseeing the
effectiveness of combined assurance
arrangements within the organisation,
directing the effort of the three lines of
assurance:
› First line of assurance: All levels of
management – covering strategy
development and implementation,
performance measurement, risk
management, and company control,
and monitoring of assurance to laws
and regulations
› Second line of assurance: Corporate
functions and oversight forums (such
as the company secretariat
compliance function, combined
assurance forums, operational audit
and risk committees) – all risk and
assurance management structures
of the company such as risk
management, compliance and legal
services
› Third line of assurance: Internal audit,
external audit and other assurance
providers who are independent of the
operational activities of the company
and provide assurance to the board.
This year, Ernst & Young Inc. audited
our consolidated annual financial
statements, from which extracts have
been included in this report. The
auditor’s audit report does not
necessarily report on all the
information included in this integrated
report. EmpowerLogic Proprietary
Limited provided external verification
of our B-BBEE activities. Marsh
South Africa conducted risk control
audits at our manufacturing sites and
warehouses covering health, safety,
security, fire protection and
readiness.
Materiality
In line with the latest development in
corporate disclosure, we have adopted
double materiality across our reporting
suite:
Financial materiality: Our IR provides
disclosure on those issues – including
relevant environmental, social and
governance (ESG) risks and
opportunities – that are likely to
influence report users’ assessment of
the value, timing and certainty of Tiger
Brands’ future cash flows over the
short term (less than 12 months),
medium term (one to three years) and
long term (beyond three years). Our
AFS reflect the effects on company
value and cash flow that have already
taken place at the time of the financial
year end, or that are included in future
cash flow projections.
Impact materiality: Our SR provides
disclosure on our most significant
impacts on people, society and the
environment. Provision is also made in
the SR for financially material ESG risks
and opportunities impacting the
business.
Our materiality process
To identify the issues for inclusion in
our IR and SR we ran an independently
facilitated materiality workshop in which
senior management representatives
from across the company critically
considered the following issues:
Our business model – reviewing Tiger
Brands’ significant revenue and cost
streams and areas for differentiation,
and identifying our most important
resources and relationships across our
value chain, including specific resources
and relationships we depend on for
capital value retention and growth.
Our impacts and influence on the
capitals – reflecting on the most
significant impacts of our activities
(positive and negative, direct and
indirect) on each of the capital stocks,
and reviewing where we have the
greatest potential to use our business
activities to positively influence capital
value retention and growth.
Our operating environment –
identifying the most important trends
in our operating environment (including
relevant sustainability-related risks and
opportunities) that we anticipate will
impact our performance over time, and
reflecting on the outcomes of our latest
internal risk assessment process.
In assessing those issues that materially
impact value creation we have looked
beyond the conventional financial
reporting boundary to provide for the
relevant interests of key stakeholders.
We have also considered the most
significant risks, opportunities and
impacts associated with our activities
over the short, medium and long term.
Board approval
The Tiger Brands’ board has applied its
collective mind to the preparation and
presentation of the information in this
report. We believe that the report
addresses all material matters and that
it presents a balanced and fair account
of Tiger Brands’ performance,
governance practices and operating
context for the financial year ended
30 September 2022, as well as an
accurate reflection of our strategic
commitments. On the advice of the
audit committee, the board approved
the integrated report and the
consolidated annual financial
statements on 1 December 2022.
Geraldine J Fraser-Moleketi
Chairman
Noel Doyle
Chief executive officer
Cora Fernandez
Chairman of audit committee
Our stakeholders’ interests –
reviewing the interests of greatest
concern to our stakeholders, including
the assessments of relevant ESG rating
agencies, and assessing how Tiger
Brands is balancing these various
interests and external assessments.
Our strategy – reflecting on the
robustness of our current strategy
to ensure Tiger Brands’ long-term
resilience is informed by the above
analysis.
The outcomes of this internal materiality
process informed the content and
structure of our IR and SR. We
prioritised the matters for inclusion in
these reports based on their relative
importance, applying the principle of
double materiality.
Our aim is that all the information in the
IR should be reasonably capable of
influencing the decision of any report-
user wishing to make an informed
assessment of Tiger Brands’ ability to
create value over time. Our IR is
structured in a manner to enable such
an assessment, by providing
information on:
Our business – outlining our group
profile, leadership team, and business
model
Our operating context – reflecting
on our operating environment, key
relationships, and material risks and
opportunities
Our strategy – outlining the current
and planned activities for each of our
six strategic objectives
Our performance – reviewing the
financial performance at a group and
divisional level
Our governance – summarising the
role of our governance and
remuneration practices in creating
value.
* Copyright and trademarks are owned by the Institute of Directors in South Africa NPC and all of its rights are reserved.
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www.tigerbrands.com
TIGER BRANDS’
2022 INTEGRATED
REPORTING SUITE
Our 2022 integrated reporting
process comprises the
following reports:
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NOURISH AND
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MORE LIVES
EVERYDAY
INTEGRATED ANNUAL
REPORT 2022
Integrated annual
report 2022
Provides a succinct review
of our strategy and business
model, operating context,
operational performance and
governance. Aimed primarily
at investors, it is written for all
stakeholders who have an
interest in Tiger Brands’
long-term performance.
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NOURISH AND
NURTURE
MORE LIVES
EVERYDAY
ANNUAL FINANCIAL
STATEMENTS 2022
Consolidated
annual financial
statements 2022
Comprehensive review of our
financial results, with audited
financial statements, prepared
in accordance with IFRS.
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MORE LIVES
EVERYDAY
SUSTAINABILITY
REPORT 2022
Supplement to the integrated annual report
for the year ended 30 September 2022
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Sustainability
report 2022
Reviews our performance
in managing our significant
impacts on people, society
and the environment, and
assessing our contribution
to sustainable development.
These are all available at:
www.tigerbrands.com
3
Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur governanceOverviewOur business
OUR VALUE
CONTRIBUTION IN 2022
The value created, preserved or eroded for our stakeholders in 2022.
DELIVERY OF VALUE BY STAKEHOLDER GROUP
Providers of financial capital
R1,4 billion paid
in dividends
(2021: R1,7 billion)
Return on net assets
26,0%
(2021: 19,3%)
R1,5 billion returned to
shareholders in share buy-back
programme
Return on equity
17,4%
(2021: 12,7%)
Return on invested capital*
16,4%
(2021: 11,7%)
Cash generated from
operations
R2,6 billion
(2021: R4,0 billion)
* As defined in the annual financial statements.
Consumers
21 innovation projects
launched this year
28,2% value share
(2021: 28,6%)
Precautionary recall
of certain baby powder
products
Suppliers
R14 billion spent with
B-BBEE-verified suppliers
(2021: R14 billion)
R7 billion spend with
black-owned enterprises
(2021: R6 billion)
R5 billion spend
with black women-
owned enterprises
(2021: R4 billion)
Customers (retailers, wholesalers, and general trade)
97% on-shelf availability (2021: 97%)
88% order-fill (2021: 90%)
Communities and environment
R26 million total socio-economic
development spend (2021: R23 million)
109 million cumulative breakfasts
supported by Tiger Brands Foundation
since 2011
Employees
R4,3 billion paid in
salaries and benefits to
9 670 permanent employees
(2021: R4,0 billion to
10 158 employees)
R97 million invested
in employee training
and development
(2021: R94 million)
3 work-related employee
fatalities (2021: 0)
FINANCIAL PERFORMANCE
(from continuing operations)
Revenue
R34,0bn
2021: R31,0 billion
10%
Group operating income*
53%
R3,4bn
2021: R2,2 billion
EPS
1 762cps
2021: 1 070cps
HEPS
1 702cps
2021: 1 127cps
Final dividend
653cps
2021: 506cps
Total dividend
973cps
2021: 826cps
65%
51%
29%
18%
* Before impairments, fair value losses and
non-operational items.
4
www.tigerbrands.com
Own and operate
41
sites in South Africa and Cameroon
WE CURRENTLY EXPORT OUR PRODUCTS
TO 33 MARKETS IN AFRICA
and export to
33
markets in Africa,
with almost
80%
of total export sales from
5 Priority markets:
Mozambique, Zimbabwe, Zambia,
Nigeria and Cameroon.
Guinea
Sierra Leone
Liberia
Mali
Burkina
Faso
Ghana
Chad
Sudan
Niger
Nigeria
Central African
Republic
Cameroon
Equatorial Guinea
Congo
Gabon
Rwanda
Democratic
Republic of the
Congo
Uganda
Kenya
Tanzania
Seychelles
Manufacture
Current exports
Out of scope*
Angola
Malawi
Zambia
Mozambique
Zimbabwe
Madagascar
* Botswana, Namibia, Lesotho and
Swaziland are serviced by the
domestic business.
Namibia
Botswana
Swaziland
Lesotho
South Africa
Mauritius
Reunion
Tiger Brands is
dedicated to growing
its footprint by
continuing to explore
new opportunities to
bring quality brands
to consumers
across Africa.
154
quality brands
and products
within
21
categories
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur governanceOverviewOur business OUR INVESTMENT CASE
› Our products provide a solution
for every meal occasion and meet
consumer needs through
a range of daily touchpoints
STRONG BRANDS
› With almost 30%* of the grocery
basket, and 10 Billion Rand
Brands, Tiger Brands has leading
positions in most categories,
and our iconic brands are
well-entrenched with consumers
in South Africa
EQUITY RANK
#1
#1
#3
#2
#2
#1
#1
#1
#1
#1
FOCUS SHIFTING TO IMPROVED RETURNS
› ROIC trending upwards towards peer group average.
ROIC VS PEERS
TBS
Peer group average
22,7%
10,6%
10,4%
8,0%
9,3%
10,0%
VOLUME RANK
FY18
FY19
FY20
FY21
FY22
#2
#1
#2
#2
#1
#1
#1
#2
#1
#1
Source: Bloomberg; iQCapital.
Company definition of ROIC is set out in the annual financial statements.
VALUE RANK
#1
#1
#2
#2
#1
#1
#1
#2
#1
#2
* Refers to value share
ABILITY TO GENERATE CASH AND RETURN CASH TO SHAREHOLDERS
› Our free cash flow conversion has
averaged ~85% over the last five
years; above the peer group average
of ~70%
FREE CASH FLOW CONVERSION
Peer group average
FCF conversion
129%
› Our ability to generate cash allows
us to re-invest into our business,
both in terms of capex and
innovation, making us more
competitive, efficient and effective
in the long term
› The execution of a share buy-back
programme demonstrates
commitment to disciplined capital
allocation while enhancing
shareholder returns
6
101%
76%
70%
70%
50%
FY18
FY19
FY20
FY21
FY22
Source: Company reports.
COMMITTED TO A POSITIVE ESG PERFORMANCE
› We have made significant
progress in delivering on our
sustainable future strategy and
on our commitments in each of
our three strategic focus areas:
health and nutrition, enhanced
livelihoods, and environmental
stewardship
› Our key initiatives focus on
reducing waste-to-landfill,
recycling packaging material,
reducing food waste and loss,
and diverting waste towards new
value-creation opportunities
› We recognise that we have a
significant responsibility to
continue addressing our material
ESG impacts and continue to
fully integrate this responsibility
across the business
www.tigerbrands.com
GROWTH AREAS
Informal market
The informal market in South
Africa is valued at approximately
R150 billion a year. We are
pursuing various initiatives to
expand our reach in this market
and have already improved the
availability of our targeted SKUs.
Innovation and marketing
investment
We have been driving innovation
and renovation in our product
offerings including price-pack
architecture, as well as investing
in more effective advertising and
marketing to highlight the value
benefits of our current brands.
Technology
We have completed the
development and approval of
a comprehensive digital strategy,
including cyber security, that
defines the key areas of focus
for the business and serves
as a comprehensive framework
and roadmap for our business
initiatives over the coming years.
Venture Capital Fund
The newly established Venture
Capital Fund made its inaugural
investment this year and has a
strong pipeline of opportunities,
particularly within health and
nutrition and snackification.
Africa
We aspire to be a pan-African
business with a South African head
office. The past year has been one
of consolidation, in which we have
fixed the basics and positioned the
business for growth.
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur governanceOverviewOur business GROUP PROFILE
GRAINS
CONSUMER
BRANDS
Our core business is
providing everyday
branded food
products to large
and growing markets.
We target best-in-
class profitability,
underpinned by a
cost-conscious
culture, and ESG
principles to create
and share value.
We have leading positions in
most categories and our iconic
brands are well-entrenched
with consumers in South
Africa, as illustrated by the
percentage share of market.
HOME AND
PERSONAL CARE
EXPORTS AND
INTERNATIONAL
www.tigerbrands.com
TOP BRANDS
MARKET SHARE (%)
Grains
Mazie
Flour
Cereals
Rice
Dry pasta
Bread
Groceries
Spreads
Condiments
Canned fruit &
vegetables
Snacks & Treats
Chocolate
Candy
Beverages
Dilutables
Sports drinks
Ready-to-drink
Baby nutrition
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27
23
20
48
38
35
27
46
32
42
56
42
49
54
48
20
11
23
65
Home Care
(Pesticides)
Personal Care
7
61
Source: iRI 12 month moving to end September 2022.
Revenue
Operating income
46%
Grains
38%
36% Consumer Brands 42%
5%
13%
Home and
Personal Care
Export and
International
9%
11%
Milling and
Baking
› Baking
Milling
› Flour
› Maize
› Sorghum
Other grains
› Pasta
› Oat-based
breakfast
(Jungle)
› Rice
Beverages
› Concentrates
› Sports drinks
› Ready-to-
drink
Baby
› Nutrition and
wellbeing
Groceries
› Condiments
and
ingredients
› Spreads
› Canned
fruit and
vegetables
Snacks & Treats
› Sugar
› Chocolate
Home Care
› Sanitary
cleaners
› Pesticides
Personal Care
› Body care
(includes
Camphor
cream)
Depilatories
› Hair care
› Deodorant
› Hair styling
International
operations
Central Africa
(Chococam)
Deciduous fruit
› Langeberg &
Ashton Food
(LAF)
Up
6%
Down
7%
Up
12%
Up
25%
Down
5%
Down
29%
Up
19%
Up
265%
Revenue
R15,5bn
2021: R14,6 billion
Operating income
R1,3bn
2021: R1,4 billion
Revenue
R12,4bn
2021: R11,1 billion
Operating income
R1,4bn
2021: R1,1 billion
Revenue
R1,9bn
2021: R2,0 billion
Operating income
R308m
2021: R433 million
Revenue
R4,3bn
2021: R3,6 billion
Operating income
R350m
2021: R96 million
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Our operating contextOur strategyOur performanceOur governanceTiger Brands Limited Integrated annual report 2022Our businessOverviewCamphor OUR BOARD
www.tigerbrands.com
THE BOARD REPRESENTS A RANGE OF CORPORATE AND
STRATEGIC BUSINESS LEADERSHIP SKILLS, DIVERSITY
AND INDEPENDENCE TO APPROPRIATELY EXERCISE SOUND
JUDGEMENT AND LEADERSHIP IN DIRECTING TIGER BRANDS
TO CREATE VALUE IN THE INTERESTS OF ALL STAKEHOLDERS
EXECUTIVE DIRECTORS
NON-EXECUTIVE DIRECTORS
NOEL DOYLE 56
Chief executive officer
Re-joined the group in 2012 and
appointed CEO February 2020
Area of expertise and contribution
› Leadership and strategy execution
› Extensive FMCG experience
› Corporate finance and governance
› Legal and commercial
DEEPA SITA 45
Chief financial officer
Appointed October 2020
Area of expertise and contribution
› Leadership and strategy
› Extensive finance and governance
› Risk management
› Innovation and IT
› Procurement practices
› FMCG
Board meeting attendance
› 9/9
Board meeting attendance
› 9/9
NON-EXECUTIVE DIRECTORS
DONALD WILSON 65
Appointed June 2019
LUCIA SWARTZ 64
Appointed June 2022
MAHLAPE SELLO 60
Appointed October 2019
CORA FERNANDEZ 49
Appointed March 2019
Area of expertise and contribution
› Mergers and acquisitions and
stakeholder engagement
› Extensive finance and general
› Governance and remuneration
› Leadership and strategy
management
Area of expertise and contribution
› General management and strategy
› Extensive human resources
› Remuneration policies
› Governance and FMCG
Area of expertise and contribution
› Extensive legal and commercial
› General management and leadership
› Governance and strategy
› Stakeholder relations
Area of expertise and contribution
› Extensive finance and investment
› Auditing and accounting
› Governance and general
› Leadership and strategy
management
Board meeting attendance
› 9/9
Board meeting attendance
› 4/4
Board meeting attendance
› 9/9
Board meeting attendance
› 9/9
The board embraces
the spirit of corporate
governance principles
and best practice
approach to facilitate
successful execution
of the company’s
strategy and attain
sustainable growth to
enhance shareholder
value.
Our governance framework
is designed to support our
core purpose in line with the
Companies Act, JSE Listings
Requirements, King IV™ and
other relevant laws and
regulations and ensures that
Tiger Brands remains a good
corporate citizen.
Nomination and governance
committee
Risk and sustainability committee
Remuneration committee
Investment committee
Social, ethics and
transformation committee
Audit committee
Chairman
EMMA MASHILWANE 47
Appointed December 2016
GAIL KLINTWORTH 59
Appointed August 2018
OLIVIER WEBER 59
Appointed August 2020
FRANK BRAEKEN 62
Appointed April 2022
MICHAEL AJUKWU 66
Appointed March 2015
GERALDINE FRASER-
MOLEKETI 62
Chairman
Appointed September 2020 and
appointed chairman January 2021
Area of expertise and contribution
› Leadership and strategy
› Extensive governance and public
› Stakeholder relations and
administration
sustainability/ESG leadership
Area of expertise and contribution
› Extensive auditing and finance
› Governance and leadership
› Corporate finance and banking
› FMCG
governance
Area of expertise and contribution
› FMCG
› General management and
› Stakeholder relations
› Brand and reputational
› Innovation and marketing
› Extensive sustainability/ESG
leadership and strategy
management
Board meeting attendance
› 9/9
Board meeting attendance
› 9/9
Board meeting attendance
› 9/9
Area of expertise and contribution
› General management and strategy
› Mergers and acquisitions
› Governance
› Business turnaround and
culture transformation
› Risks management and
marketing and brands
› ESG experience
Area of expertise and contribution
› General management and strategy
› Mergers and acquisitions
› Governance and risk management
› FMCG and emerging market
› Sustainability/ESG
Area of expertise and contribution
› Stakeholder relations
› Risks and general management
› Corporate finance
› West Africa
› Banking and finance
› FMCG
Board meeting attendance
› 9/9
Board meeting attendance
› 7/7
Board meeting attendance
› 9/9
10
10
11
Our operating contextOur strategyOur performanceOur governanceTiger Brands Limited Integrated annual report 2022Our businessOverview OUR EXCO
www.tigerbrands.com
Our executive
committee facilitates
the effective control
and monitoring of
the business activities
in terms of the
delegation of authority
framework approved
by the board.
It is responsible for
implementing policies and
executing strategies in line
with the board’s mandate
and ensuring that appropriate
internal controls are in place
to maintain compliance with
relevant laws and best
practice.
OUR EXECUTIVE COMMITTEE REPRESENTS DIVERSITY
OF KNOWLEDGE, SKILLS, BACKGROUNDS AND NEW
PERSPECTIVES WHICH FOSTER BETTER DEBATE AND
DECISION MAKING UNDERPINNED BY OUR VALUES.
NOEL DOYLE 56
Chief executive officer
DEEPA SITA 45
Chief financial officer
THUSHEN GOVENDER 46
Chief growth officer: Consumer Brands
Re-joined the group in 2012 and
appointed CEO February 2020
Appointed October 2020
Appointed May 2021
DEREK MCKERNAN 55
Chief manufacturing officer
CLIVE VAUX 71
Corporate finance executive
Appointed July 2020
Exco member since January 2022
Appointed February 2000
Retired September 2022
S’NE MAGAGULA 49
Chief human resources officer
Appointed May 2018
MARY-JANE MORIFI 60
Chief corporate affairs and
sustainability officer
Appointed December 2016
LUIGI FERRINI 55
Chief customer officer
Re-joined the group October 2009
Exco member since May 2019
EXCO TENURE
Tenure
EXCO DEMOGRAPHICS
7
4
0 – 5 years
6 – 10+ years
JOE RALEBEPA 51
Chief legal officer
Appointed January 2020
SARVESH SEETARAM* 43
Acting chief strategy and
marketing officer
Since June 2022
* Becky Opdyke resigned May 2022.
YOKESH MAHARAJ 50
Chief growth officer: Grains
Re-joined the group November 2021
Age
30%
Female
representation
5
5
1
40 – 50 years
51 – 60 years
61 – 70 years
12
12
13
Our operating contextOur strategyOur performanceOur governanceTiger Brands Limited Integrated annual report 2022Our businessOverview CHAIRMAN’S
REVIEW
GERALDINE FRASER-MOLEKETI CHAIRMAN
As Africa’s largest food producer, with a legacy of
establishing and maintaining some of South Africa’s
best-loved brands over its one-hundred-year history,
Tiger Brands has a particularly important responsibility in
delivering and sharing value for its many stakeholders. It is
fair to say that the company has been underperforming
over the past five to 10 years; much of this has been due
to various management missteps, and the market has
punished us accordingly.
I BELIEVE THAT TIGER BRANDS’ IMPROVED
PERFORMANCE THIS YEAR, IN THE CONTEXT OF
SOME CHALLENGING EXTERNAL HEADWINDS,
REFLECTS AN IMPORTANT SHIFT IN TRAJECTORY.
It gives me confidence that the company has passed an inflexion point
and is now heading in the right direction. The management team has
made significant progress in stabilising the business and getting the
basics right, positioning the company to be more creative, more agile
and more aggressive in hunting down and delivering on some of the
untapped opportunities for growth.
Encouraging performance in a challenging environment
This year, group operating income and HEPS from continuing
operations were up 53% and 51% respectively, year-on-year. At
financial year end, we declared an ordinary final dividend of 653 cents
per share, in line with the dividend policy of 1,75x cover. In addition, we
initiated a share buy-back programme. A total of 9,49 million shares
were purchased returning R1,5 billion to shareholders, demonstrating
our commitment to better returns. These improvements in financial
performance were delivered in the face of a very challenging socio-
economic environment, characterised by low economic growth,
higher than expected cost inflation and reduced consumer spend,
compounded by an uncertain macro-economic and political
environment in South Africa and globally. Following the profound
disruption of the pandemic, we have
seen further impacts on global supply
chains and input costs associated with
the conflict in Ukraine, while locally we
are impacted by continuing electricity
supply constraints and broader
infrastructure challenges, high
unemployment, political and socio-
economic challenges exacerbated
by growing levels of inequality.
In addition to these significant external
headwinds, the company has faced
various internal challenges, including
prolonged strike action at the Snacks
& Treats operation, some recent
vacancies at a senior management
level, and the impact of a general skills
shortage in some technical areas
critical to our business. Given these
challenges, it has been pleasing to see
some important improvements in the
company’s performance, as well as
the progress it has been making in
some core areas, laying an important
foundation for growth.
14
14
In response to the constrained
consumer environment, there has
been a heightened focus on value-led
innovation and renovation in Tiger
Brands’ product offerings and price-
pack architecture, as well as various
initiatives with customers aimed at
strengthening our position at the point
of purchase. Increased effort is now
being put into harnessing digital
technologies and information solutions
to drive operational efficiencies,
increase automation, and improve
customer and consumer data and
analytics. The company is also further
developing its centralised procurement
capability and repositioning its logistics
activities, both of which offer the
potential to unlock significant value.
While I believe that Tiger Brands has
turned the corner and is beginning to
produce the desired step change in
performance, there is still work to be
done if the company is to fully deliver
on its potential in a sufficiently timely
manner. Given our scale and the
strength of our legacy brands, this
year’s performance in Bakeries has
been a particular disappointment.
Looking ahead, the management team
has a good understanding of the
underlying challenges, and the board
has recently approved a compelling
five-year strategic roadmap for Bakeries
aimed at driving volume growth,
strengthening our position through
innovation, accelerating cost savings,
and embedding the right performance-
based culture. This has been a year of
consolidation in our Rest of Africa
operations, with sales volumes restored
in key markets and investment in some
of our operations creating a solid
foundation for growth. Despite a slow
start to the year, the underlying
fundamentals suggest that we have
the right strategy and that there are
exciting growth prospects in our
portfolio.
Focusing on product safety
One of our key responsibilities as
Africa’s largest food producer, is to
contribute to regional food security,
improve nutrition and maintain the
highest levels of food safety and quality.
Following the tragic listeriosis incident
in February 2018, Tiger Brands’ board
has strengthened its oversight of the
company’s product safety and quality
management practices, both across its
own operations and among suppliers,
and third-party manufacturing partners.
Although we have seen further
significant improvements this year in
some key quality metrics – with a 14%
reduction in consumer complaints, on
top of the step change in improvement
in the prior year – this has been
overshadowed by the precautionary
recall in September 2022 of certain
baby powder products. Coming off the
back of last year’s precautionary recall
of just over 20 million cans of vegetable
product, this has understandably
caused some concern in the market
about the robustness of the company’s
management of product quality and
safety. Although the recall has not had
a material impact on Tiger Brands’
direct financial performance, it has
undermined our reputation.
While this recall is disappointing, I remain
confident that the management team is
fully committed to instilling a culture of
product safety and quality across the
company, building on the robust internal
management and review systems,
www.tigerbrands.com
critical control measures and new
technologies that were introduced
across its manufacturing facilities
and externally managed
warehouses. In response to this
product recall, we have undertaken
a root cause analysis and are
implementing various corrective
measures. As a board, we will
ensure an appropriate level of
accountability for any mistakes that
were made, and that the necessary
measures are taken to uphold our
commitment to product safety
and quality.
Upholding strong ESG
performance
In delivering on the company’s
purpose – to nourish and nurture
more lives every day – and as part
of our sustainable future strategy,
the company has recently revised
environmental, social and
governance (ESG) targets for
2030 relating to health and
nutrition, enhanced livelihoods,
and environmental stewardship,
with some of these introduced into
remuneration incentives. Pleasing
progress has been made this year
in each of the three focus areas,
aimed at leveraging our business
model to drive positive social
change. To address some of the
more immediate food security
challenges, and the recent
troubling rise in hunger-related
deaths among children in South
Africa, in September this year the
company launched Isondlo, a
R42 million nutrition programme
that supports 10 000 food-insecure
children, aged five and younger,
and their families, with a monthly
15
Our operating contextOur strategyOur performanceOur governanceTiger Brands Limited Integrated annual report 2022Our businessOverview CHAIRMAN’S REVIEW CONTINUED
food hamper for nine months.
This initiative is in addition to the
9 000 food hampers that are already
distributed monthly as part of Tiger’s
existing food nutrition programmes, as
well as our longer-term core business
initiatives to improve health and
wellbeing by providing more nutritious
and affordable food products,
developing best-in-class nutritional
standards, and leveraging our brand
to promote better consumer nutrition.
pleasing to see the progress made this
year in minimising our environmental
footprint, the various projects aimed at
increasing the use of renewable energy
at our facilities, improving energy and
water efficiency, and minimising
packaging and food waste. We
recognise that we have a significant
responsibility to continue addressing
our material ESG impacts and commit
to fully integrate this responsibility
across the business.
Given the tough macro-economic
environment, we recognise that as a
larger company we have a particular
responsibility in fostering inclusive
development, stimulating job creation
and improving livelihoods across our
value chain. The challenge of protecting
jobs and maintaining business viability
has been highlighted recently as the
company strives to find a solution for
our deciduous fruit business, Langeberg
and Ashton Foods (LAF), that no longer
aligns with our portfolio. Following an
exhaustive process over the past two
years, in which prospective buyers
have been unable to secure the funding
needed to meet working capital
requirements, the company
recommenced operations for another
season while continuing to engage
with organised labour, employees, and
members of the Canning Fruit
Producers Association, as well as
provincial and national government
and prospective buyers, to identify a
sustainable commercial solution that
will protect the 250 permanent and
4 300 seasonal jobs, sustaining the
broader local economy. It has also been
Governance
As chairman, I am incredibly fortunate to
have a strong and highly engaged board,
with significant FMCG skills and a strong
international presence, well-suited to
ensuring robust accountability of the
management team.
There have been several changes to
the board this year. Ms Maya Makanjee
stepped down as independent
non-executive director with effect
from 31 December 2021, and
Mr Mark Bowman retired from the
board immediately after the close of the
AGM in February 2022, both after more
than 10 years of service. The board
extends its gratitude to each of these
departing members for their valuable
contribution and wishes them well in
their future endeavours. Mr Frank
Braeken and Ms Lucia Swartz were
appointed as independent non-executive
directors with effect from 1 April 2022
and 1 June 2022, respectively. Frank has
deep FMCG and emerging markets
experience, having held various senior
and executive roles at Unilever in Eastern
Europe, Latin America, Africa and Asia,
while Lucia has wide-ranging experience
in human resources leadership having
worked for BP Southern Africa, the
Seagram Group of companies, and
Sappi, before serving as Vice President,
People at AB InBev Africa.
Appreciation
This has been another challenging year,
but one in which I believe the company
has turned a corner. If we maintain a
relentless focus on execution,
underpinned by a strong culture, the
right capabilities and clear end goal,
then I have no doubt that Tiger Brands
will fulfil its potential and further
strengthen its position as a market
leader. On behalf of the board, I would
like to thank the Tiger Brands
management team and all the
employees for their effort in responding
to some significant challenges and
moving the company on a path to
growth.
Geraldine J. Fraser-Moleketi
Chairman
1 December 2022
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16
CHIEF EXECUTIVE
OFFICER’S REVIEW
NOEL DOYLE CHIEF EXECUTIVE OFFICER
Tiger Brands’ pleasing results this year, delivered in the
context of an extremely tough operating environment,
should give confidence to investors and other
stakeholders that the company has turned a corner
after several years of disappointing performance.
I believe that this year’s results, underpinned by a
strong second-half recovery, should give confidence
that we have stabilised the core and are now well-
positioned to deliver long-term value and growth.
OUR RECENT INVESTMENTS IN TECHNOLOGY
AND DIGITAL CAPABILITIES, OUR PROGRESS IN
REPOSITIONING OUR INNOVATION, PROCUREMENT
AND LOGISTICS ACTIVITIES, AND OUR CONTINUED
INVESTMENT IN OUR PEOPLE AND MANUFACTURING
OPERATIONS, ARE ENABLING US TO REALISE
UNTAPPED OPPORTUNITIES.
This year we met almost all our short-term financial targets for the group,
despite the pressure of a very flat consumer market, anaemic GDP
growth, extraordinary input cost inflation, and the impact of industrial
action in the first half. Although we have made progress in those areas
where the measures are more tangible and the solutions more obvious
and formulaic, I believe that we are now well-positioned to deliver results
where solutions require better data interrogation and analysis, as well as
rapid and agile trial and error.
Total revenue from continuing operations increased by 10% to R34,0 billion,
driven by price inflation of 11%, and marginal overall volume declines of
1%. Further improvements in supply chain efficiencies and revenue
management initiatives resulted in the overall gross margin (excluding the
impact of the product recall and civil unrest) being maintained at 30,3%.
Group operating income before impairments and non-operational items
was up 53% to R3,4 billion. Earnings per share was up 65% to 1 762 cents
per share, while headline earnings per share increased by 51% to
1 702 cents per share. During the year we completed a value-enhancing
share buy-back programme that was well-received by the market over
and above paying a total dividend of 973 cents per share.
www.tigerbrands.com
Delivering on our strategic
objectives
Our improved performance this year
reflects effective execution across our
strategic priorities that were developed
to improve the performance of our
current portfolio, deliver an effective
turnaround over the short term, and
set us up for longer-term growth.
We made pleasing progress this year
in building a growth pipeline, stepping
up our innovation activities across the
group, optimising our product portfolio,
and pursuing various customer and
channel initiatives to win at the point
of purchase. We have improved our
channel segmentation and deepened
our understanding of shopper profiles
to inform our store execution plans
and ensure more effective campaigns,
pricing and promotions. We are
continuing to expand into the informal
market, targeting 60 000 active spaza
stores by 2024, supported by a team
of sales representatives and tailored
distribution models. Anticipating
significant further growth in
e-commerce, we have been raising
our online presence with a view of
17
Our operating contextOur strategyOur performanceOur governanceTiger Brands Limited Integrated annual report 2022Our businessOverview
CHIEF EXECUTIVE OFFICER’S REVIEW CONTINUED
becoming the preferred supplier to
prioritise e-commerce partners. We are
embedding revenue management
principles across the organisation and
have developed a comprehensive
decision-making tool to enable detailed
analysis at an SKU and customer level
to identify priority revenue growth
opportunities. After a slow start for
the Rest of Africa segment, we have
restored sales volumes in key markets
and improved factory performance,
creating a solid foundation for growth.
We are driving various strategic initiatives
to meet the needs of consumers. Given
the constrained consumer environment,
our priority focus has been on delivering
market-leading solutions for the
value-conscious consumer – with
innovations in certain categories to meet
more affordable price points, including
new value packs in beverages, canned
food and personal care categories –
while also continuing to capture
opportunities in health and nutrition,
snackification and at-home
consumption.
Optimising our supply chain remains a
critical enabler and key priority within
our growth plan. In addition to investing
in upgrading and expanding some of
our manufacturing operations, we have
made progress in embedding a strong
quality culture, supported by qualified
people and robust integrated
management systems. Although
we saw pleasing improvements in our
quality KPIs, this progress was
overshadowed by a precautionary
product recall of certain baby powder
products. We have undertaken a root
cause analysis and are implementing
various corrective actions, including a
thorough review of our raw material
and finished product risk assessments,
specifications and product release
protocols across all our product
categories. Despite our various
occupational safety training,
assessment and auditing initiatives, it
was a disappointing year in terms of
our safety performance, with the tragic
fatality of one Albany driver and two
contractors, reflecting a broader
increase in work-related injuries,
particularly among contractors.
Addressing this issue is a top priority
for next year.
Our cost savings and efficiencies drive
across the group delivered R387 million
in savings this year. Although this was
slightly short of our target, due mainly
to external inflationary pressure in
procurement, the improved efficiencies
reflect our work in further embedding
the well-established cost-savings culture
across the group, supported by
improved accountabilities, strengthened
revenue management capabilities, and
further portfolio optimisation and SKU
rationalisation, primarily in Groceries,
Snacks & Treats, and Beverages.
Although this was a challenging year for
procurement, with global supply chain
constraints and inflationary pressures
resulting in a focus on securing supply
rather than unlocking new value, we
have a detailed roadmap in place to
strengthen our core procurement
capabilities, complete the transition to a
centralised operating model, and ensure
priority investment in the digital tools
and technology.
One of the most important and often
most challenging areas of competitive
differentiation for a business, lies in the
quality and leadership of its people.
While much of the necessary
foundational work is in place in
delivering on our strategic commitment
to igniting our people, we recognise that
more still needs to be done to fully
embed an agile performance-based
culture that will allow us to join the ranks
of truly high-performing businesses.
The high level of attrition in key technical
roles and senior leadership levels in
recent years has highlighted some
significant gaps in talent in specific
areas and underlined the importance
of improving our performance and
processes in external recruitment to
deepen our bench strength. Given
the momentum gained in strategy
execution, we have reviewed measures
to manage the retention of Exco
members, which is imperative to the
stability of our strategic and operational
support team. As a means of providing
a compelling value proposition, the
remuneration committee has thus
approved retention payments for Exco
members (excluding the CEO). This was
a once-off payment intended to retain
executives rather than reward
performance, and it is deemed to be
in the company’s long-term interest.
We have made some important strides
this year in delivering on our sustainable
future strategy, leveraging our influence,
and increasing our effort and
www.tigerbrands.com
investment, to progress our
commitments to improve consumer
health and nutrition, enhance livelihoods,
and ensure responsible environmental
stewardship. Through our launches of
new healthy products, nutrition labelling
activities, and our Eat Well Live Well
programme, as well as our recent
investment in a plant-based and vegan
start-up, we are enabling consumers to
improve their health and wellbeing. We
have continued to provide valuable
support to black and black women-
owned farming and agri-processing
enterprises, through our enterprise
and supplier development activities,
preferential procurement, agriculture
aggregator model, and investments in
socio-economic development. In terms
of environmental stewardship, an
important development this year was
the conclusion of a power purchase
agreement to introduce solar power
at four of our sites, an important step
towards our goal of sourcing 65% of our
manufacturing electricity requirements
from renewable energy by 2030.
Although there is still significant room
for improvement, our engagement with
government, regulatory bodies and host
communities has gained positive
momentum.
Following the tragic listeriosis outbreak
in 2018 and the subsequent Class
Action, pre-trial preparations to get
the matter ready for trial are currently
ongoing. The process of discovery,
which is a key part of the pre-trial
preparation, is at an advanced stage.
I reiterate our collective commitment to
ensure that a resolution of the matter is
reached in the shortest possible time,
in the interest of all parties, particularly
the victims of listeriosis and their families.
Outlook
The immediate and medium-term
outlook looks challenging. Local inflation
is at a 20-year high and rising, GDP
growth expectations are anaemic, rising
youth unemployment levels are a lead
indicator of potential social unrest,
and we are operating in a political
environment that can best be described
as a ‘holding pattern’ ahead of the
significant election in South Africa in
2024. Given this challenging outlook,
and the level of economic stratification
within the country, it is essential that
we prioritise the growing number of
value-conscious consumers by focusing
relentlessly on cost reduction, value
engineering, brand and product tiering,
and efficient end-to-end supply chain
management.
Despite these challenges, I believe
that the company made significant
progress in repositioning itself for the
future, and that our strategic approach
and recently revised operating model
present the right foundation to ensure
our resilience, enabling us to harness
the strength of our iconic brands, the
diversity of our product portfolio, the
quality of our customer relationships,
and the health of our balance sheet to
absorb these future headwinds. The
time is now right for Tiger Brands to
take some calculated risks, act on
our size, back ourselves, and put
forward more ambitious investment
plans, thinking bigger and bolder
to attract and retain the talent and
expertise we require, supported by
an unwavering focus on execution.
Appreciation
This has been a rewarding if challenging
year, thanks to the dedication and
support provided by Tiger’s employees
and my colleagues on the executive
team. I wish to extend my thanks also
to the Tiger Brands’ board for their
oversight and advice. I am confident that
together the company’s employees and
leadership teams will ensure that Tiger
Brands successfully executes our
strategy for long-term growth.
Noel Doyle
Chief executive officer
1 December 2022
18
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Our operating contextOur strategyOur performanceOur governanceTiger Brands Limited Integrated annual report 2022Our businessOverview
OUR BUSINESS MODEL
Our operating environment
Trends impacting value:
› A challenging macro-economic
environment
› Shifting customer and consumer
dynamics in an increasingly
competitive environment
› Heightened stakeholder
expectations on ESG
performance
Read more on pages 24 to 26
Material risks
R1
Albany route-to-market
R2.1 Market responsiveness
R2.2
Cost competitiveness
R3.1
Food safety
R3.2
Cyber security
R3.3
Occupational Health and Safety (OHS)
R3.4
Industrial action
R4
Third party supplier risk
Read more on pages 31 to 36
Sensitivity analysis
Tiger Brands’ cost base is highly
sensitive to exchange rate volatility
with ~70% of our costs directly or
indirectly exposed to exchange
rates. Price/volume management
is therefore a key strategic lever.
In an inflationary environment,
for every 1% price increase not
implemented, the group requires
4% volume growth to offset the
impact of higher input costs.
OUR VALUE CHAIN ACTIVITIES
Procurement
Manufacturing
Research and development
Packaging and logistics
Marketing, branding & distribution
OUR PURPOSE
› Nourish and nurture more lives everyday
Read more on IFC
VALUE IN
KEY RESOURCES
›
›
›
›
›
›
HC Experienced, diverse leadership
team and skilled employees
underpinned by strong governance
structures
NC Reliable and sustainable access to
primary agricultural products
(including wheat, rice, maize,
oats, sugar and sorghum), other
ingredients, packaging, energy, fuel
and water
MC Well capitalised manufacturing
plants, supported by efficient and
effective distribution and logistics
networks
SRC Strong and trusted corporate
brand; positive supplier and
customer relations and constructive
relationship with government,
regulators and host communities
Continuous investment in our
brands through research and
development, marketing investment,
and innovation informed by strong
consumer insights
IC
FC Access to financial capital,
through strong cash generation
and enhanced by superior investor
returns and sustained market
confidence
Read more on pages 10 to 12; 27; 38 to 48 and 54
KEY RELATIONSHIPS
› Employees and trade unions
› Customers
› Consumers
› Government
› Investors
› Suppliers
› Communities
› Media
Read more on pages 27 to 30
GOVERNING THE VALUE
CREATION PROCESS
The board represents a range of corporate
and strategic business leadership skills,
diversity and independence to appropriately
exercise sound judgement and leadership
in directing Tiger Brands to create
value for all stakeholders.
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20
Our revenue streams
Our revenue streams comprise
product sales from:
› Grains: 46%
› Consumer Brands: 36%
› Home and Personal Care: 5%
› Exports and International: 11%
Material revenue differentiators
› The group’s long-standing market-
leading position in branded food and
beverages
› Our “Billion-Rand Brands”, many of
which are rated first or second in their
categories and have received many
external awards as South Africa’s most
loved brands
› A robust marketing strategy to ensure
our brands remain relevant and
top-of-mind, supported by increased
and targeted investment
› Far-reaching distribution capabilities
› The strength and quality of our
relationships with our customers
› Strong consumer insights informing
our category strategies
Our cost streams
Our most significant cost streams are:
› Raw material procurement
› Sales and distribution expenses
› Marketing expenses
› Maintenance and upgrading of plant
and equipment
› Food quality and safety
› Employee wages and benefits
› Electricity and fuel
› Regulatory compliance costs
› Other administrative costs
Material cost differentiators
› Our vertical supply chain
› Standardisation and simplification of
group processes, systems and practices
› Centralised procurement function
leveraging scale both internally and
externally
www.tigerbrands.com
VALUE OUT
OUR PRODUCTS
(OUTPUTS)
Grains
Groceries
Baby Nutrition and
wellbeing
Beverages, Snacks
& Treats
Home and
Personal Care
OUR IMPACTS
(OUTCOMES)
Significant impacts (positive
and negative) include:
› Consumer nutrition
and health
› Natural resource use
› Food and packaging
waste
› Employment (direct
and indirect)
› Development of small
business
› Government tax revenue
› Shareholder returns
› Investment in
infrastructure, plant
and equipment.
Read more on pages 22 and 23
21
Our operating contextOur strategyOur performanceOur governanceTiger Brands Limited Integrated annual report 2022Our businessOverview HOW WE SUSTAIN VALUE
Social and relationship capital
Our people
SRC
HC
Our brand, reputation
and company culture
IC
MC
FC
NC
Manufactured capital
Financial capital
Natural resources
www.tigerbrands.com
MATERIAL INPUTS
› Engaged workforce
› Constructive relationship with government
› Investor confidence
› Trusted brands and strong consumer
reputation
› Positive supplier and customer relations
› Robust operating context and strong levels
of institutional trust
OUR ACTIONS TO SUSTAIN VALUE
› Investment in employee value proposition
› Structured engagement with regulators; focus on
compliance and societal contributions
› Regular investor communication
› Investment in product safety and quality
› Product and process innovation
› Active engagement with suppliers and customers
› Trading terms that are fair, equal and available
to all customers
OUTCOMES OF OUR ACTIVITIES
Generally positive relations across
stakeholder groups
14% reduction in consumer complaints
R14 billion B-BBEE supplier spend
R1,3 billion spent to support black farmers and
small businesses
Continuing concerns in certain areas
Product recall of certain baby powder products
Pending listeria Class Action lawsuit
› Strong and diverse board
› Experienced executive team
› 9 670 permanent employees
› Enabling workplace environment with
performance- and purpose-led culture
› Historically strong brand and reputation
› Unique product formulations and trusted recipes
› Research and development capacity
› Internal governance and business systems
› Company culture
› 41 manufacturing facilities
› Efficient logistics and distribution activities
› Equity
› Borrowings
› Cash generated from operations
› Implementing people strategy to build a diverse
› Focus on innovation and renovation to meet
talent base, develop leadership capacity and create
a great place to work
› Invested in employee reward and personal
development opportunities
consumer needs including on value, health and
nutrition, convenience, e-commerce and
sustainability
› Deploy marketing best practice toolkit across
– R4,3 billion on wages and benefits
– R97 million invested in employee training and
development (2021: R94 million)
› Focus on diversity and employment equity
› Embedded enhanced employee wellbeing
programme (THRIVE)
the business
› Drive relevance in value segment by building clear
benefits of current brands
› R961 million capital expenditure in manufacturing
› Implementation of fit-for-future operating model
and distribution capability and technology
› Completed the development and approval of
a comprehensive digital strategy
› 9% improvement in overall equipment
effectiveness (OEE) across our focus sites over
past three years
› Achieved R354 million in savings through
improved material usage variance (MUV) over past
three years
with clear lines of accountability
› Continued operational efficiency drive
› Strong corporate governance structures
› Acceleration of portfolio optimisation
› Clear guiding principles in response to the
growth of private label
› Local and imported raw material ingredients
› Water (municipal and own borehole) for
production
› Fuel (diesel and petrol) for distribution and
manufacturing
› Energy for manufacturing (primarily Eskom
electricity)
› Fertile soil and conducive agricultural conditions
› Energy and water efficiency measures
› Investment in renewable energy to strengthen
energy security and reduce carbon footprint
› Innovations and partnerships to reduce packaging
and food waste
Investment in talent and personal development
Accelerated core capability in manufacturing,
customer, marketing and R&D
Launched accelerated leadership development
programme
Sustained a strong brand presence
Completed purpose journeys on majority of our
major brands with evident impact
Won Kantar award for Best Liked Ad in 2021
(Tastic Rice)
Innovation launches
Completing 21 innovation projects across our
consumer growth areas, achieving a R1,1 billion
(4,2%) innovation rate
First Venture Capital Fund investment –
in plant-based vegan start-up
Progress in promoting employee diversity
94% ACI and 31% female
Eliminated historical wage and salary income
differentials ahead of target
Board diversity
67% black and 60% female on our board
Directors with extensive FMCG knowledge,
global experience and skills in digitalisation
and innovation
Focus on improved employee health and
safety going forward
Three work-related fatalities (2021: 0)
0,45 lost-time injury frequency rate (2021: 0,31)
driven by improved reporting to consistently
include contractor injuries
Continued investment in plant and
equipment
Expand capacity, optimise efficiency, upgrade
infrastructure and realise innovation
opportunities
Some challenges remain
Capex disbursement below guidance
27,7% return on net assets (RONA)
(2021: 19,3%)
R75 million paid in net interest
(2021: R54 million)
R2,6 billion cash generated from operations
(2021: R4,0 billion)
Savings of R387 million (2021: R498 million)
Total dividend per share declared: 973 cents
(2021: 826 cents)
18,4% return on equity (2021: 12,7%)
ROIC of 16,4% exceeds the average weighted
cost of capital of 13,6% (2021: 11,7%<12,2%)
Some progress in mitigating impacts
13% reduction in direct GHG emissions
13% reduction in GHG emissions intensity
7% reduction in absolute energy use
8% reduction in electrical energy intensity
8% reduction in absolute water use
7% reduction in water-use intensity
32% reduction in waste to landfill intensity
Challenges remain in certain areas
The global food system is recognised as having
a significant impact on biodiversity and habitat
loss, climate change and packaging pollution,
placing direct pressure on the resources we
depend on and, increasing consumer and
regulatory practices
See pages 45 – 47 and sustainability report 2022
See page 40
See page 48
See sustainability report 2022
22
22
23
Our operating contextOur strategyOur performanceOur governanceTiger Brands Limited Integrated annual report 2022Our businessOverview OUR OPERATING
ENVIRONMENT
Our business landscape remains highly dynamic and uncertain, with important implications
for our business model and strategy.
Our ability to create value, and to deliver on our purpose, is significantly influenced by
various changing dynamics in our external operating environment. We have identified three
priority and interconnected trends that impact on our business model and that have
informed our strategy. Our six strategic priorities have positioned the company to respond
effectively to the risks and opportunities emerging in association with each of these trends.
www.tigerbrands.com
A CHALLENGING MACRO-
ECONOMIC ENVIRONMENT
The global economy has
slowed down, interest rates
have gone up, inflation has
returned to a level not seen
for decades and there are
profound uncertainties
associated with the ongoing
conflict in Ukraine.
Low economic growth, combined with
high unemployment, comparatively low
wage growth and surging food price
inflation, continues to suppress
consumer spending in South Africa,
compounded by challenging market
conditions globally. Recent increases
in food commodity prices, as well as
higher packaging, transport and
logistics expenses, have placed
significant pressure on input costs,
which remain difficult to recover in
the subdued consumer environment,
placing sustained pressure on margins.
Food inflation soared this year with
record highs reported in South Africa.
In July 2022, the country’s annual
producer inflation reached a new
high of 18%, above market forecasts
of 17,6%. Bread and cereals inflation
has continued to quicken, with the
annual rate rising to 13,7%1. A recent
SA retail report2, shows significant
declines in sales volumes of items
such as frozen meat, cooking oil and
fresh milk, reflecting the impact of
consumer inflation’s acceleration
to a 13-year high.
1 Stats SA.
2 NielsenIQ State of the Retail Nation,
June 2022.
24
24
This tough macro-economic
environment and sustained pressure
on household incomes has contributed
to reduced demand for discretionary
and premium products, increased
consumer uptake of value offerings,
and heightened price competition.
Volumes and margins are threatened,
and cost recovery ahead of inflation
remains a challenge. The outlook is
not encouraging, with a tougher trading
environment anticipated due to the flat
economy, downward pressure on
our currency, continuing high rates of
unemployment and indebtedness, and
ongoing electricity supply constraints,
on top of local political uncertainty and
the potential for social unrest.
Our strategic response
› Given the subdued economic outlook
and our exposure as a premium
priced brand in staple products,
securing growth will require an intense
focus on driving efficiencies, as well
as a step-change in our innovation
practices and in our customer and
consumer engagement initiatives.
› Two years ago, we introduced a more
systemic approach to delivering cost
saving and efficiencies across the
business, changing the governance
structures, improving accountabilities,
strengthening our central revenue
management capability within each
of our business units and improving
our SKU rationalisation. This year we
maintained our focus on this efficiency
drive, delivering R387 million in
savings over the year.
› To improve productivity and secure
long-term cost savings across
our supply chain, we have made
further investments in improving our
manufacturing operations. We are
strengthening our centralised
procurement function, and we have
made initial progress in implementing
an ambitious logistics transformation
programme.
› We have completed the development
and approval of a comprehensive
digital strategy that defines the key
areas of focus for the business and
serves as a comprehensive
framework and roadmap for our
business initiatives over the coming
years.
› To meet the needs of the value
conscious consumer, we have been
driving innovation and renovation in
our product offerings including
price-pack architecture, as well as
investing in more effective advertising
and marketing to highlight the value
benefits of our brands. We are
continuing to rationalise our brand
and product portfolio, seeking to
preserve margins by focusing
resources on our best performing
lines and we have been identifying
and delivering commercially viable
opportunities to manufacture private
label products, albeit small.
› In striving to play our part in
addressing some of the underlying
socio-economic challenges facing
the country, we are continuing in our
efforts to boost economic
opportunities and improve the
livelihoods of thousands of people
across our value chain through a
deliberate focus on supporting black/
black women farmers and owned
enterprises as part of our enterprise
and supplier development activities,
and our preferential procurement
practices.
› To mitigate the immediate impacts
of declining food security and
growing nutritional challenges among
children in South Africa, we have
recently launched a multimillion-rand
child nutrition programme, Isondlo,
that supports 10 000 food-insecure
children and their families with a
monthly food hamper for a nine-
month period.
Key commodities
South African inflation
6 000
5 000
4 000
3 000
2 000
10 000
9 000
8 000
7 000
6 000
5 000
4 000
3 000
8,0
7,5
7,0
6,5
6,0
5,5
5,0
4,5
Jan 2021
Oct 2022
■ White maize – Safex R/t
■ Wheat – Safex R/t
■ Yellow maize – Safex R/t
Oct
2021
Jan
2022
Apr
2022
Jul
2022
Source: Reuters.
Source: Stats SA.
SHIFTING CUSTOMER AND
CONSUMER DYNAMICS IN
AN INCREASINGLY
COMPETITIVE MARKET
Changes in consumer
behaviour and an increasingly
competitive retail environment
are impacting the way in
which our customers are
servicing shoppers, and
in turn, informing how we
engage with our customers
and with consumers.
In the context of reduced disposable
incomes, increasing digital connectivity,
a rise in urbanisation, and shifting
consumer aspirations relating to
health, nutrition and sustainability,
shoppers are changing their purchasing
patterns, demanding more in terms
of affordability, convenience and
product quality. Consumers are typically
shopping less frequently, across fewer
categories, and at fewer retailers,
for bigger baskets, with growth
biased towards essential categories.
E-commerce channels have become
markedly more important for middle-
and higher-income groups, while the
practice of home cooking and stocking
pantries has increased broadly, along
with momentum towards more
health-conscious purchasing. Many
middle- and high-income consumers
are now looking behind the brand to
assess whether the operating practices
and impacts of food producers and
retailers are aligned with their values
and priorities.
Responding to these changing
consumer dynamics in the context
of intensifying competition within the
sector, food retailers and wholesalers
are looking to defend and grow
market share by being more precise
and deliberate in their consumer
engagement strategies. Retailers are
strengthening their analysis of shopper
behaviour, leveraging basket data to
segment their stores to satisfy specific
shoppers through targeted ranging,
pricing and promotions. At the same
time, we are seeing some fundamental
shifts in our route-to-market, with
supermarkets facing strong competition
from mixed and wholesale retailers,
independents, and emerging informal
players, as well as from convenience
retail solutions such as forecourts
and e-commerce. Retailers and
independents are increasingly entering
the general trade market, with Shoprite
and Pick n Pay both venturing into the
wholesale arena. These developments
are requiring us to revise our channel
strategies and further strengthen
customer engagement and service
levels. As competition intensifies,
with retailers driving “always-on” price
promotions, this has reinforced the
importance of strong revenue
management practices and robust
pricing data and analytics to ensure
that our product prices, placement
and availability are properly aligned
within each customer segment.
In addition to competitive pressure
among customers, we are seeing
heightened competition in the food
producer environment, with some
recent market entrants challenging
traditional market leaders and placing
significant pressure on industry
margins. We are continuing to see
aggressive competitor pricing, as well
as increasing sophistication in private
label penetration, both of which are
25
Tiger Brands Limited Integrated annual report 2022Our strategyOur performanceOur governanceOur businessOverviewOur operating context OUR OPERATING ENVIRONMENT CONTINUED
placing pressure on branded product
volumes and margins. As
convenience and value have become
key drivers of consumer choice, and
informal players capture consumers
closer to home, a shift to smaller
pack sizes has enabled market
expansion and affordable price
points. Heightened promotional
activity has undercut margins, runs
the risk of damage to price
perception, and inspired competition
and differentiation towards richer
value propositions that threaten brand
dominance.
Our strategic response
› We have been working to embed
shopper-centricity into our
segmentation of stores, deepening
our understanding of broad
shopper profiles to ensure greater
customer alignment, more
impactful trade execution, and
increased shopper conversion
through targeted pricing and
promotions and appropriate
price pack architecture.
› We have strengthened our
customer marketing teams,
established key account forums
and joint business plans with major
customers, and refined our
pay-for-performance trading terms
with clearer performance metrics to
incentivise customer performance
aligned with our strategic growth
drivers.
› We are pursuing various initiatives
to expand our reach in general
trade and forecourts, grow our
e-commerce presence, and
strengthen our position
in neighbouring countries.
› We have stepped up our innovation
efforts across the group, focusing
on fewer, larger innovation projects
– on value, nutrition, and
convenience/snackification. Our
recently established Venture Capital
Fund made its first investment this
year in a local startup established
with the goal of making healthy,
plant-based foods accessible and
affordable in South Africa.
HEIGHTENED STAKEHOLDER
EXPECTATIONS ON ESG
PERFORMANCE
There has been a marked
increase in investor and
stakeholder engagement on
companies’ environmental,
social and governance
(ESG) performance and
disclosure, with a growing
expectation on companies
to show sustainability
leadership.
The recent uptake in investor interest
on ESG themes – evidenced for
example by the growth in assets under
management of ESG-aligned funds
– reflects the impacts of some broader
trends, including growing recognition
and concern around the extent of
environmental and social challenges,
heightened stakeholder expectations
on business to lead in addressing these
challenges, and an increase in
regulatory and voluntary initiatives on
companies’ sustainability performance.
With the food system identified globally
as “the single strongest lever to
optimise human health and
environmental sustainability”, and with
South Africa having some profound
food-related health challenges – such
as high levels of lifestyle-induced
non-communicable diseases, and
persistent hunger and malnutrition – we
are seeing greater stakeholder scrutiny
specifically on the role and responsibility
of the food sector in addressing the
nutritional, health, and environmental
outcomes of the food system.
Higher-income consumers are more
willing to trade-off on price for health and
sustainability, with growing demand for
brands-with-purpose, sustainable and
local products, plant-based proteins,
ethical marketing and front-of-pack
nutrition labels. These shifts challenge
some traditional business approaches
and encourage the adoption of purpose-
led innovation. Some large global
companies are applying increasing
pressure on their suppliers to proactively
address environmental impacts,
accelerate social transformation and
prioritise value creation that aligns with
public health interests.
Our strategic response
› Our sustainable future strategy
supports delivery of our core
purpose, communicates our forward-
looking approach to sustainability,
and orients the business towards
improving our ESG performance. The
strategy comprises three clear focus
areas: health and nutrition; enhanced
livelihoods; and environmental
stewardship.
› We have made further progress this
year on our commitment to enabling
consumers to improve their health
and wellbeing, providing food
products that are more nutritious and
affordable, developing best-in-class
nutritional standards and leveraging
our brand and marketing activities to
promote consumer nutrition.
› We have continued to invest in
strengthening product quality and
food safety across the company to
ensure that we have robust systems,
qualified people, and a strong quality
and safety culture, achieving external
certification for all our manufacturing
facilities against globally recognised
food safety standards.
› We are continuing in our efforts to
improve the livelihoods of thousands
of people across our value chain,
using our procurement practices and
our investment in supplier and
enterprise development, to stimulate
economic opportunities, including
through a specific focus on
supporting black/black women
farmers and owned enterprises.
› We are striving to reduce our
environmental impact by implementing
innovative solutions that optimise
energy and water consumption in our
operations, reduce the negative
impacts of packaging, and minimise
waste, effluent and emissions. We are
exploring opportunities for circular
economy initiatives that stimulate
sustainable economic opportunities,
using our marketing activities to
inspire positive behaviour change
in consumers.
www.tigerbrands.com
OUR KEY
RELATIONSHIPS
We have a structured
stakeholder relations
strategy in place to ensure
a consistent and proactive
approach to engagement
across the group.
In the table below we identify those stakeholder groups that have a
substantive impact on our ability to create value, briefly outlining their
contribution to value creation, our means of engaging with them, and each
stakeholder group’s primary interests relating to our business activities.
Although we appreciate that there is often substantial diversity of perspective
and interest within each group, we believe that the interests listed below are
a sufficiently accurate reflection of each group’s most material interests
regarding Tiger Brands’ activities and performance.
EMPLOYEES
Provide the capability, experience and innovation required
to deliver on our business strategy
Link to strategy
How we engage
employees
What is important
to employees
Responding to
employee interests
CEO engagements
Talent and career development
Virtual and in-person executive
leadership engagements
Internal website
ROAR App designed for
employee engagement
Digital communications
Employee hotline
Site engagements
Focus groups
Extended leadership
engagement session
Remuneration and rewards
Strong internal engagement
Cross-functional teamwork and
collaboration
Diversity, inclusion and equity
Recognition and feedback
Work-life balance, safety and security,
and wellbeing
Opportunities to innovate and challenge
the status quo
Speed and visibility of decisions
Our people strategy and operating
model seeks to address each one
of our employee issues directly
Employee feedback is solicited
through our Voice of Tiger engagement
and employee experience survey and
pulse which is conducted across all
our sites in six languages
Specific actions to address key
feedback areas
Fit-for-purpose people processes
focusing on talent, capability
development, leadership, rewards,
wellbeing, engagement and culture
Our THRIVE employee wellbeing
programme directly supports employees
and their families by proactively managing
their physical, emotional and mental
wellbeing
TIGER TROLLEY, a digital staff shop,
is a direct response to employee needs
in a socio-economically challenged
environment
See sustainability report
26
26
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Tiger Brands Limited Integrated annual report 2022Our strategyOur performanceOur governanceOur businessOverviewOur operating context OUR KEY RELATIONSHIPS CONTINUED
www.tigerbrands.com
CUSTOMERS
Our retail and wholesale customers provide shoppers with ready access to our
brands and through them, access to our targeted consumers, and the opportunity
to purposefully influence their buying behaviours and purchasing decisions.
Link to strategy
GOVERNMENT
Provide the regulatory framework and informs the socio-economic
context essential for our activities
Link to strategy
How we engage
customers
What is important
to customers
Responding to
customer interests
How we engage
government
What is important
to government
Responding to
government interests
Senior leadership engagement (top-to-top)
to align on business priorities, joint corporate
initiatives, and optimised trading practices
Trading terms and promotional pricing that are
fair and equal, and which promote mutual
profitable growth
Annual trading term negotiations to agree
on shared growth ambitions and associated
strategic business levers and investments
to achieve the performance objectives sets
Innovation, commercially attractive brand
propositions, and marketing campaigns that
appeal to their shoppers and drive profitable
basket conversion
Joint category development planning
to collaboratively identify shared growth
opportunities and agree on joint action
plans and investments
Operational systems and ways of working that
enhance logistics and administrative
efficiencies facilitating cost-effective speed to
market and continuous supply
Regular action planning meetings to execute
business plans, respond to tactical dynamics,
and resolve operational issues to achieve our
joint performance targets
Stock availability
Competitive pricing
Promotional support
Routine business review sessions to identify
and address performance shortfalls as well
as take advantage of new opportunities
Alignment on business priorities and commitment
to shared growth ambitions and action plans
Collaborative cross-functional projects/initiatives
to address prioritised business imperatives
Tailored solutions and campaigns in support
of customer-specific growth opportunities and
initiatives
Sharing of market/shopper research and
knowledge to better inform business and
category growth strategies
Proactive performance reviews that identify
competitive growth opportunities and risks
coupled with ideas and proposals
Utilising the Tiger basket to drive value-adding
promotions through combos
CONSUMERS
By purchasing our products, and believing in our brand,
they provide the basis for revenue growth
Link to strategy
How we engage
consumers
What is important
to consumers
Responding to
consumer interests
Tiger Brands’ website
Food safety, product quality and authenticity
Promotional activities and competitions
Product affordability and value
Information on our packaging
Health and nutrition
Research, including continuous engagement
via consumer communities, on- and offline
qualitative studies, immersions, visual diaries
and preparation
Neuroscience to identify implicit behaviour
in-store and communication engagement
Consumer care line
Multi-channel approach as well as integration
of online and offline channels to provide a
seamless user engagement experience
Cooking shows and blogs
CSI activities, community programmes and
feeding schemes
Business leadership on social,
economic and environmental issues
Convenience
Experiences
Community support
Inspiration
Innovation routed in addressing consumer
needs
Continuous sensory evaluation to meet quality
and consumer expectations
Further activities to align our food safety and
product quality systems with best practice and
ensure compliance
Consumer awareness campaigns on food safety
and brand authenticity
Strive to mitigate inflationary pressures through
cost-saving initiatives, operational efficiencies,
and SKU rationalisation
Leveraging price pack architecture to provide
consumers “more for less” and more affordable
packaging formats
Awareness initiatives on consumer
health and nutrition
Value creation through meaningful value and
nutrition innovation
Eat Well Live Well (EWLW) endorsement
Sensory experiences
Within food, consumers seek to be inspired on
new ways to use our products. This has driven
an increased use in recipe branded content
across traditional (television, radio and print)
and online channels (Foodies of SA, Facebook,
Instagram and TikTok)
Partnership with content creators (influencers)
within the foodie space to inspire use of products
See pages 41 and 42
28
28
One-on-one engagements
Job creation and preservation
Engagements on draft regulations
Public forums
Industry consultative bodies
Parliamentary processes
Economic development and growth
of the township economy
Food safety and quality
Consumer nutrition and health
Delivering on broad-based black economic
empowerment (B-BBEE) and boosting
employment opportunities
Fostering growth and development
of local agricultural sector
Robust safety systems in place supported by
academic partnerships
and consumer campaigns
Public Private Partnership to revitalise the
economy (eg, Agri Processing Master Plan)
In-school breakfast programme in partnership
with Tiger Brands Foundation
Investment in B-BBEE verified suppliers and
promotion of socio-economic development
Internal drive to ensure representation
at executive and management level
Investment in skills development
Active partnerships to promote agri-sector
development and smallholder farmers
Engage on draft policy and legislation
INVESTORS
Provide the financial capital needed for long-term growth
Link to strategy
How we engage
investors
Annual and interim reports
One-on-one meetings, non-deal roadshows,
investor conferences
SENS announcements
Dedicated investor relations function
and mailbox
Website
What is important
to investors
Responding to
investor interests
Impact of significant inflation across
input costs and the consequential impact
on volumes in a constrained consumer
environment
Ability to sustain momentum of turnaround
strategies given the operating environment
Lack of visibility of growth drivers
Capital allocation decisions particularly
in the context of low capex disbursement
relative to guidance and returning cash
to shareholders in the context of a
strong balance sheet
Impact of global skills constraints and
the ability to attract and retain talent
Successfully implemented price increases while
managing volumes accordingly
Clear differentiation of defending volume categories
and defending value categories
Clear strategies focused on value engineering
initiatives to enhance competitiveness on shelf
Kept the market abreast of progress in terms of
execution of innovation and renovation plans to meet
the needs of consumers seeking value
Demonstrated the implementation of efficiency
programmes, which include a pilot solar project and
other strategies to limit the impact of power supply
disruptions, to maximise product availability and
deliver customer service excellence
Reputational risk of recurring product
quality issues
Executed a share buy-back programme to the value
of R1,5 billion over and above ordinary dividends
Reliable electricity supply and the impact of
prolonged periods of loadshedding on our
operations
Demonstrated our ability to attract and retain talent
through key appointments during the period, as well
as our ability to nurture and grow talent internally.
Retention awards made to executive committee,
excluding the CEO, to sustain the momentum in
achieving the turnaround strategy
Enhanced internal and supplier management
protocols to ensure superior quality control
procedures including zero tolerance to public
health risks
29
Tiger Brands Limited Integrated annual report 2022Our strategyOur performanceOur governanceOur businessOverviewOur operating context OUR KEY RELATIONSHIPS CONTINUED
SUPPLIERS
Provide the services and products that form
the basis of our products and activities
How we engage
suppliers
Supplier forums
Site visits
What is important
to suppliers
Timely payment and fair terms
B-BBEE commitments
Supplier assessments
Enterprise and supplier development
Health and safety standards
COMMUNITIES
Provide the social capital and licence to operate
for the business to succeed
Link to strategy
Responding to
supplier interests
Negotiate with strategic suppliers to
secure requirements
Collaborating with Tiger Brands’ Enterprise
and Supplier Development programme to
diversify the supply base with a focus on
black-owned and black women-owned
suppliers
Engage key suppliers to drive procurement
efficiencies, improve B-BBEE commitments
and innovation
Reviewed supplier quality programme being
rolled out in line with enhanced internal quality
protocols
See sustainability report
Link to strategy
How we engage
communities
What is important
to communities
Responding to
community interests
Guided by stakeholder engagement policy
Food security and related nutrition issues
Community NGO implementation partners
Community social mapping to identify
opportunities to share value
Community mobilisation and interaction on
SED projects
Stimulate economic activity to support and
sustain community enterprise development
and job creation
Impact of our operations on host communities
Partner with government and developmental
agencies to promote nutrition, health and
education, and contribute to community
development and poverty eradication
Initiatives in place on enterprise and supplier
development and community investment
See sustainability report
MEDIA
Contribute to brand reputation and enhance stakeholder
awareness of our products and performance
Link to strategy
How we engage
media
What is important
to media
Responding to
media interests
Executive committee engagement
as appropriate
Increased and timely access to management
and information
All media queries addressed within specified
timeframes
Dedicated team oversees proactive and
structured media engagement
Media section on our website
Media releases and interviews
Social media presence
Fair treatment of stakeholders
Overall operational and sustainability/
ESG performance
Strengthened media governance
and protocols
Enhanced media monitoring and analysis
Being accessible
30
30
MATERIAL RISKS
AND OPPORTUNITIES
RISK GOVERNANCE
The board governs risk in a manner
that supports Tiger Brands in setting
and achieving its strategic objectives.
While the board delegates oversight
responsibilities to the audit committee
and to the risk and sustainability
committee, it remains accountable
for the governance of risk and for
ensuring that Tiger Brands’ combined
assurance model enables an effective
control environment. This is done in
a manner consistent with generally
accepted frameworks and good
practice, including King IVTM and
ISO 31000:2018.
Implementation
responsibility and culture
Whereas the board and its committees
execute oversight duties, the executive
committee is tasked with the design,
implementation, and operation of
risk and combined assurance
arrangements. This includes the
development and maintenance of an
appropriate risk awareness culture
to establish an enabling environment
within which these arrangements can
be deployed. It is within this context
that Tiger Brands gives life to the
philosophy of continuous improvement,
tempered by the need to remain
fit-for-purpose.
Risk profiling
Tiger Brands adopts a bi-directional
comprehensive approach to identifying
risks, which includes a top-down as
well as bottom-up analysis. The
top-down approach starts with a
group view of Tiger Brands allowing
for the big picture to develop.
Consideration is given to the operating
environment, the business model, and
the associated objectives and
strategies defined by the group.
Similarly, business units are required to
analyse, among others, their operating
environments, business models,
products, and strategies to identify
risks specific to them, which are
reported to the group level for
oversight. Common business unit risks
may then be identified and may
potentially be managed at the
group level.
Furthermore, Tiger Brands recognises
that effective risk management may
generate additional benefit beyond the
protection that simple risk remediation
affords, eg, enhancing a competitive
advantage, or perhaps increasing
reputational standing with stakeholders.
As such, cost-benefit assessments on
risk responses and remediation
strategies include opportunities as part
of the benefit assessment, while costs
associated with remediation actions are
included in the cost side of the
assessment. This allows Tiger Brands
to select risk responses and
remediation actions that are context
appropriate and rooted in a
comprehensive and balanced approach
to risk management.
The group executive committee
oversees the identification of group
risks and responses. Business unit
management oversees and manages
business unit risks and reports the
most material risks to the group
executive committee through the
operational risk management
committee. A consolidated Tiger
Brands risk profile is then compiled
and reported to the board risk
and sustainability committee before
finally being submitted to the
board of directors.
In addition to the analysis and
remediation of top risks, we maintain
a combined assurance programme that
aims to provide stakeholders with
comfort that the control measures
deployed to shape risks are adequate
and effective.
www.tigerbrands.com
Risk appetite and tolerance
General risk appetite and tolerance
ranges are defined by group executive
management and annually approved
by the board. These ranges are
reflected in the heat maps and provide
general guidance regarding expected
responses to mapped risks. In
addition, for each risk group executive
management determines a targeted
residual risk level. These targets are
set against the backdrop of the
approved risk appetite and tolerance
ranges and more specifically define the
nature and extent of each risk’s control
improvement plan. This is subject to
oversight as per the Tiger Brands’ risk
management policy, together with the
risk assessment, its analysis, and its
current controls.
While the group will accept risk to
achieve its ambitions of being a
market-leading, international,
diversified FMCG company, there is
a strong focus and aversion to risk in
the areas of food safety, the delivery
of quality products and loss of life.
Oversight
The design, implementation and
operation of the risk and combined
assurance arrangements are
subject to quarterly oversight by
the operational risk management
committee, the risk and sustainability
committee, and the board of directors.
The first is a sub-committee of the
group executive committee and
includes group executive
management, business unit
management and corporate
functional leads, while the other
is a sub-committee of the board.
Notwithstanding this oversight
programme, the management teams
of the various business units and
group operations monitor and
manage their risk profiles continuously.
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Tiger Brands Limited Integrated annual report 2022Our strategyOur performanceOur governanceOur businessOverviewOur operating context
MATERIAL RISKS AND OPPORTUNITIES CONTINUED
This active and continuous process
of engagement with risks provides
the basis for reporting into the quarterly
risk oversight programme.
OUR TOP RISKS
Our material risks are those that exceed
our residual tolerance level and are thus
identified as having the most material
implications for Tiger Brands and its
employees.
The heat map represents the inherent
risk profile of our material risks. Without
adequate remediation the risks are
potentially a threat to the group as a
going concern and thus merit
management attention.
R1
Albany route-to-market
R2.1
R2.2
Market responsiveness
Cost competitiveness
R3.1
Food safety
R3.2
Cyber security
R3.3
Occupational Health and Safety (OHS)
R3.4
Industrial action
R4
Third-party supplier risk
R1
R2.1 R3.1
R3.2 R3.3
R2.2 R3.4
R4
INHERENT RISK MAP
Catastrophic 5
Critical 4
Significant 3
t
c
a
p
m
I
Minor 2
Insignificant 1
1
Unlikely
2
Possible
3
Likely
4
Almost certain
Likelihood
RESIDUAL RISK MAP
R1
R2.1 R2.2
R3.1
R3.2
R3.3
R3.4
R4
Catastrophic 5
Critical 4
Significant 3
t
c
a
p
m
I
Minor 2
Insignificant 1
1
Unlikely
2
Possible
3
Likely
4
Almost certain
Likelihood
www.tigerbrands.com
Following management’s intervention
through various remediation
programmes, some of which are still
being implemented, the material risk
profile shows a marked improvement,
albeit still in need of further remediation.
The positioning of Albany route-to-
market and cost competitiveness
do not appear to improve on the back
of implemented control processes,
reflecting the company’s cautious
stance on these risks. Although we are
confident in our response strategies,
we are monitoring the effectiveness
of control processes for clear evidence
of improvement. Once evidence is
apparent, the residual risk ratings for
these risks will be reassessed. Similarly,
market responsiveness shows a
marginal improvement from inherent
to residual level because of the
dynamic and often uncontrollable
nature of the market, together with
the need to see tangible evidence of
control effectiveness before reducing
risk levels.
The following table briefly reviews the
implications, mitigation measures, and
the year-on-year trend in the risk rating,
for each of our top risks.
1. ALBANY ROUTE-
TO-MARKET
Attacks on Albany delivery
vehicles carrying stock
and cash
Risk trend óó
2021 Ranking (1)
2.1 MARKET
RESPONSIVENESS
Inadequate response to
changes in market dynamics
(customer and consumer)
and competition
Risk trend óó
2021 Ranking (2)
Context and value impact
Mitigating actions
Tiger Brands’ aversion to risks
that threaten employee health
and safety has resulted in this risk
remaining our top risk, with incidents
this year – including robbery, assault,
and hijackings – remaining
unacceptably high.
Our measures aim to reduce the
occurrence of violent crime against
drivers and include collaboration with
law enforcement agencies and
partners. We have also increased
response effectiveness by implementing
defensive driver and first aid training
and using technology solutions to
support rapid alert and response
action. We have piloted a cashless
solution and are assessing the viability
of a broader roll-out of this solution.
Context and value impact
Mitigating actions
Meeting and exceeding customer
and consumer needs and wants is
the lifeblood of our business. With
consumer spending remaining
depressed and competition high,
this challenge remains material and
threatens our market share, brand
equity, profitability and distribution
channels.
Our mitigations revolve around the
following key themes:
› Collaborating with customers and
researchers to better understand
market needs and wants, while
leveraging insights garnered by our
own consumer insights division
› Ensuring that product and
customer mix are optimal
› Maximising service levels to ensure
product availability at location.
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2.2 COST
COMPETITIVENESS
Decline in competitiveness
due to higher input costs
across the entire value chain,
with specific reference to
procurement, manufacturing,
packaging and logistics,
and corporate costs
Risk trend
New
3.1 FOOD SAFETY
Harm to the consumer caused
either by foodborne illnesses
(food products), or undesired
skin/body reactions (personal
and home care products)
Risk trend óó
2021 No movement (Joint 3)
Context and value impact
Mitigating actions
Our supply chain remains a central
component of our ability to remain
cost competitive. Its capacity and
associated costs were adversely
impacted by the resurgence of
economic activity as the threat of
Covid-19 subsided. Local electricity
disruptions have exacerbated the
need for alternative energy sources
(such as diesel to run generators)
that are often more expensive and
not in line with Tiger Brands’
environmental aspirations.
› Prioritising the availability of stock
to ensure consistent service levels
› Maximising the efficiency of the
logistics value chain
› Manufacturing optimisation to
reduce material usage variances
and improve overall plant efficiency
› Enhanced forecasting, renegotiating
creditor terms and conditions and
careful oversight
Context and value impact
Mitigating actions
Tiger Brands elected to split food
safety and product quality risks to
better manage the underlying drivers.
Food products have inherent capacity
to lead to health concerns for
consumers and therefore remain
at the forefront of management’s
attention given the company’s risk
averse stance when it comes to
public health and safety.
The nature of food safety demands
that we approach it in a scientific and
systematic manner to ensure consistent
and repeatable results. To this end
we have implemented:
› Quality risk assessment and
management protocols (including
incident management processes)
› Rigorous accreditations processes
› Industry hygiene and quality
standards and certifications
› Positive release protocols
› Operational monitoring and reporting
processes
› Extensive and ongoing employee
training programmes.
A key improvement initiative starting in
FY23 is the roll-out of quality IT systems
that will be phased in over three years.
www.tigerbrands.com
3.2 CYBER SECURITY
Any risk of financial loss,
disruption or damage to
Tiger Brands’ reputation due
to failures of its information
technology systems because
of large-scale cyber security
attacks
Risk trend óó
2021 No movement (Joint 3)
3.3 OCCUPATIONAL
HEALTH AND
SAFETY (OHS)
Failing to provide a safe
working environment for
our employees, contractors,
and visitors
Risk trend
New
Context and value impact
Mitigating actions
Increasing interconnectivity,
globalisation and “commercialisation”
of cyber crime are driving greater
frequency and severity of cyber
incidents, including data breaches.
This can compromise the confidentiality,
integrity and availability of information
and technology resources, lead to
disclosure of commercially sensitive
information, intellectual property and/or
disruption to operations. In addition to
non-compliance risks, the release of any
personal information also has negative
reputational and brand implications.
Our five-year cyber security roadmap
is mitigating key risks identified through
independent cyber assessments.
› Various core capabilities have been
purchased and are being implemented
› Strong skill sets added to the team
through vendor partnerships to
ensure we are ready to respond
to any cyber incident
› We are building capacity to ensure
monthly reporting on our cyber
security status; this is critical in
ensuring continuous improvement
and visibility in ensuring that identified
gaps are addressed.
Context and value impact
Mitigating actions
Our direct involvement with the
manufacturing of products creates
an inherently dangerous environment.
This risk was elevated on the back
of lagging indicators, such as
manufacturing lost-time injuries coming
under pressure during the year.
We are encouraged, however, by the
improvement seen in our leading
indicators, which include an increase
in the number of safety risks and
observations recorded as well as an
improvement of the Safety, Security,
Health and Environment (SSHE)
pillar score at the Manufacturing
Competitiveness Enhancement
Programme (MCEP) sites. This
underlying progress suggests that
benefits emanating from our safety
initiatives are coming to fruition.
Tiger Brands’ comprehensive approach
to OHS management aims to prevent
incidents of injury and provide quality
incident response capability. This is done
through the operation of a group-wide
safety programme, as well as ongoing
assurance activities to validate the
effectiveness of the control processes.
Key measures include:
› The Tiger Brands’ OHS strategic
framework
› MCEP SSHE pillar assessments
and remediation actions
› Defined reporting and investigation
protocols
› Health centres
› First responder training
› Medical emergency and business
continuity plans.
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OUR STRATEGY
www.tigerbrands.com
Tiger Brands is one of
Africa’s largest listed
manufacturers of
FMCG. Our core
business is the
manufacture,
marketing and
distribution of
everyday branded
food and beverages.
Our products are relevant
across every meal occasion
and are well-positioned to grow.
The portfolio also includes
leading brands in the home
and personal care segments
and we have a growing
presence in Africa.
OUR PURPOSE
IS TO NOURISH AND
NURTURE MORE
LIVES EVERYDAY.
DELIVERING ON OUR PURPOSE:
OUR STRATEGY
BUILDING A
GROWTH PIPELINE
MEETING THE NEEDS
OF THE CONSUMER
OPTIMISING OUR
SUPPLY CHAIN
Innovation
Value-conscious
World-class
Optimising our product
consumers
manufacturing facilities
portfolio
Health and nutrition
Product quality and safety
Winning at the point of
Snackification
Procurement
purchase
Growth in Africa
Inorganic growth
Logistics
BEING OBSESSED
ABOUT COST SAVINGS
AND EFFICIENCIES
Unlocking costs and cash
Digital transformation
IGNITING
OUR PEOPLE
INVESTING IN A
SUSTAINABLE FUTURE
Talent
Health and nutrition
Leadership
Enhanced livelihoods
Great place to work
Environmental stewardship
3.4 INDUSTRIAL
ACTION
Deteriorating labour relations
and associated disruption
of our value chain
Risk trend
2021 Ranking (new)
Increase in the movement
driven by wage negotiation
cycles, as well as below inflation
wage increases relative to
the cost of living
4 THIRD-PARTY
SUPPLIER RISK
Failing to adequately manage
risks associated with the
following outsourced activities:
manufacturing, and in-bound
supply
Risk trend
2021 Ranking (new)
Context and value impact
Mitigating actions
Within a context of labour-dependent
manufacturing that is unionised the
threat of industrial action remains
prevalent, especially during wage
negotiations. Failure to contain
industrial action may lead to poor
service levels, erosion of profitability
and market share.
› Embedding an employee relations
strategy that is geared towards
creating labour stability and a great
place to work
› Execution of employee engagement
and shop floor development
programmes
› Continuous review of our
remuneration policies and practices
to ensure competitiveness and
relevance
› Business continuity plan
Context and value impact
Mitigating actions
Tiger Brands collaborates with
various supply chain partners to
deliver on its strategies. These suppliers
provide raw materials, ingredients
and packaging and in some instances,
finished goods, which are subject to
quality control processes outside of
Tiger Brands’ protocols. Failure to
ensure adherence to Tiger Brands’
specifications and standards may
erode consumer satisfaction,
profitability and brand equity.
Relationships with these suppliers and
manufacturers are carefully contracted
to maintain Tiger Brands’ quality
requirements and allow for performance
management. Beyond contractual
compliance, Tiger Brands also
implements physical inspections upon
delivery and, where appropriate, we
obtain Certificates of Analysis. Finally,
Supply Quality Assurance (SQA) audit
programmes are rolled out to provide
necessary assurances.
Retired risks
The impact of Covid-19 was retired
from the risk profile this year. The South
African government's move to an
unrestricted social and commercial
environment on the back of a marked
decrease in severe cases of Covid-19
follows the broader international trend.
On the back of this, the expectation
of a return to lockdown conditions
experienced during the last two years
is lower and as a result this risk has
been retired as a standalone risk. This
does not imply, however, that it no
longer represents a threat to Tiger
Brands. The group remains vigilant to
its effects and to the possibility that it
may again develop into a material risk
and has thus included pandemics as
root causes for the materialisation of
other risks. Our business continuity
programme provides the foundation of
our response to events of this nature.
Emerging risks
The company has identified several
emerging risks, including climate
change, the reliable supply of
administered services such as water
and electricity, and fuel shortages.
The physical and transition risks of
climate change are particularly relevant
to Tiger Brands’ operations given its
strong agricultural association. The risk
retains its emerging status due to its size
and complexity, making it difficult to
describe and manage as a single risk.
We continue to monitor climate change
from a bottom-up and top-down
perspective, identifying specific themes
as their relationship with Tiger Brands
become more apparent.
Water and electricity are similarly an
important dependency in our
manufacturing processes. We have
largely addressed the unreliable supply
of electricity by installing generators and
concluding power purchase agreements
to introduce solar power at four of our
plants, an important step towards a
broader rollout. This comes, however, at
a significant cost. Access to reliable
water supply to support our operations
is an important emerging risk, impacted
by changing rainfall patterns arising from
climate change, as well as challenges
relating to municipal water infrastructure
in certain areas; this may affect the
continuation of operations, production,
product quality and food safety.
A related concern is fuel shortages.
The increased reliance on generators
to mitigate against loadshedding
increases the use of fuel. In addition,
fuel permeates the supply chain from
inbound logistics, to manufacturing to
channel distribution. Moreover, general
market shortages will impact the cost
of inputs as increased fuel prices
impact inflation.
We are closely monitoring and
managing these risks through normal
risk management processes.
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Tiger Brands Limited Integrated annual report 2022Our strategyOur performanceOur governanceOur businessOverviewOur operating context www.tigerbrands.com
› Ensuring best practice revenue
management
› Delivering an impactful presence
at the point of purchase through
enhanced customer engagement
and precision execution.
We have made pleasing progress this
year in almost all these focus areas,
delivering against most of our agreed
success metrics, other than our
performance in terms of general service
levels, which was particularly impacted
earlier in the year following various
supply challenges that meant we were
unable to meet customer demand.
On channel segmentation, we have
been working to embed shopper-
centricity into our segmentation of
stores and our growth strategies to
ensure greater customer alignment,
more impactful trade execution and
increased shopper conversion.
Developing appropriate insight and
understanding of broad shopper
profiles is informing our shopper
activation and store execution
principles and plans, and ensuring
more effective shopper messaging
and campaigns, targeted pricing and
promotions, and appropriate price
and pack architecture.
Recognising the growing importance
and contribution of the informal
market to the total South African FMCG
sector, and that this market is growing
ahead of modern trade, we are pursuing
various initiatives to expand our reach in
this market (general trade), as well as in
forecourts. Through our aggressive
roll-out plan, we have targeted reaching
60 000 active spaza stores by 2024,
#1
BUILDING
A GROWTH
PIPELINE
To realise our ambition of building a growth pipeline
through best-in-class category, channel, and customer
strategies, we have been driving an innovation pipeline,
optimising our product portfolio, winning at the point of
purchase, and pursuing growth in Africa, while identifying
opportunities for inorganic growth.
Delivering growth through innovation enablement
This year we stepped up our innovation efforts across the group, successfully
completing 21 innovation projects across all our consumer growth areas, achieving
a R1,1 billion (4,2%) innovation rate with a priority focus on value, health and
nutrition, and snackification.
Although our performance fell slightly short of our internal ambitions for the year due
to pipeline re-prioritisation, pleasingly we are now outperforming the market in terms
of share of innovation. We measure our share of innovation against our market share
to understand whether we are pulling our weight in driving category growth; this
year we achieved a positive share of innovation, improving significantly from -17,1%
in 2021 to +3,2%.
This year we developed an evolved Tiger commercialisation framework that
enhances our existing process. As part of this, we have developed and rolled out a
set of tools and guidelines to support innovation project leaders and team members
by providing clarity and access to current best practices. We now have access to a
single centralised commercialisation source (the Tiger Commercialisation iHub) that
houses all information for project teams. We have made important progress this year
in harnessing the value of various external partnerships and collaborations with
universities and expert third-party suppliers that have been helping us to address
technology gaps and drive speed to market. We have also been working with the
page 42 to supplement our own internal pipeline,
Tiger Venture Capital Fund
accessing external innovators and ideas that may not yet be scalable or easy
for us to build internally.
PERFORMANCE
SUMMARY 2022
Positive developments
Market-leading contribution of innovation
to market share, following internal process
improvements
Fully staffed cross-functional R&D team
Successfully migrated to performance-based
trading terms across all customers
General trade store roll-out and distribution
on track
Exit of UAC to open future Nigerian growth
opportunities
Stabilised Rest of Africa (RoA) base reflected
in significant profit growth
Developed good partner networks to
facilitate potential M&A
Opportunities for improvement
Accelerate initiatives to further improve
customer service levels and stock availability
Improve the robustness of our future
innovation funnel, and further strengthen
speed to market and commercialisation
Scope to further improve our equity score in
some of our Billion Rand Brands
Appointment of new leadership for ROA to
drive growth activities
Optimising our product portfolio
To deliver on our growth ambitions,
we are continually evaluating and
optimising our product portfolio.
Using a structured approach, we have
identified those categories with high
attractiveness and competitive strength
that should be invested in and grown,
those where we will focus on improving
profitability, and those to be evaluated
for possible exit through a carefully
structured process.
Informed by this assessment we see
potential for further growth in Rice,
Breakfast (Jungle), Snacks & Treats,
Beverages, Home Care, Exports and
International, including Chococam, with
opportunities for enhanced profitability in
Other Grains, particularly Baked Goods
and Pasta, Groceries, and Flour. We are
investing in product and process
innovation, driving further process
efficiencies, and/or expanding
production capacity in these areas.
In rationalising our portfolio, following
a review of our forecast five-year
performance against the stated portfolio
objectives, we are continuing to review
the status of the following business units
over the medium term: Deciduous Fruit,
Maize, Sorghum-based beverages and
breakfast, and Personal Care.
Winning at the point
of purchase
We are seeking to secure sustained
growth and win at the point of purchase
by delivering on our commitments in
three broad focus areas, underpinned
by optimising our sales force and
people capabilities, and by improving
our data and IT platforms. Our targeted
focus areas are:
› Growing in new and existing channels
– by improving channel
segmentation, expanding our reach
in general trade and forecourts,
growing our e-commerce presence,
and strengthening our position
in neighbouring countries
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur performanceOur governanceOur businessOverviewOur strategy BUILDING A GROWTH PIPELINE CONTINUED
supported by a dedicated team of sales
representatives, and delivery through
three different distributions models.
Since completing a baseline audit two
years ago, we have already improved
the availability of our targeted SKUs.
We believe that there is valuable growth
potential in the Hard Discounters
sector – those merchants with fewer
SKUs, at lower prices driving hard deals
on promotions – where we have
traditionally been under-indexed. To
realise these growth opportunities,
we have developed differentiated price
packs, targeted promotions and
merchandising, and lower-cost
route-to-market initiatives, and we have
been pursuing partnerships on private
label brands.
In response to the recent and
anticipated rapid growth in the
e-commerce channel, we have been
driving various initiatives to raise our
online presence and become the
preferred supplier to prioritised
e-commerce partners. We have made
pleasing progress in our three targeted
areas: increasing sales in “Bricks and
Clicks” (such as Checkers Sixty60 and
Pick n Pay ASAP) by building occasion-
based cross-category promotions and
ongoing brand activations; growing our
online presence and conversion in
“Pure Play” (such as Takealot and Yebo
Fresh) by creating a “shop in a shop”
for key categories, sponsored search,
soft bundle promotions, and bulk deals;
and delivering a reward-based mobile-
first transactional food service ordering
platform for “Out of Home”, in
partnership with key distributors.
We have also been trialling our pilot
online employee shop.
We have prioritised five clear levers
within our revenue management
practices aimed at ensuring that our
product prices, placement and
availability are properly aligned within
each customer segment, based on an
informed understanding of customers’
perception of product value. We have
refined our new pay-for-performance
trading terms framework with clearer
performance metrics aimed at
incentivising strong customer
performance aligned with our strategic
growth drivers. To improve identification
of profitable revenue growth
opportunities, we have developed a
comprehensive decision-making tool
that connects disparate data sets to
enable detailed analysis at an SKU and
customer level. Revenue management
principles have been embedded
across the organisation.
To address the recognised recent
challenges in terms of customer
service levels, we have been working
on various initiatives to improving
customers’ perception of their
relationship with Tiger Brands to ensure
that we are consistently rated as a
top-three supplier. We will be
deepening our direct relationship with
customers by moving away from a
single seller/single buyer relationship
to a series of cross-functional and
multi-level relationships. We are
continuing to work more closely with
customers to ensure greater alignment
between our category strategies and
customer strategies, as well as
involving customers at an appropriate
level in our innovation planning and to
ensure more effective joint forecasting.
Driving growth in Africa
We have ambitious plans to deliver
significant growth across Africa over the
next four years, building on our current
established presence across the
continent. We have been targeting
consumer-led category growth through
carefully chosen brand investments
and innovations in key categories,
developing superior routes-to-markets,
and investing in developing supply
chain capacity, underpinned by
strengthening core competencies
across the region.
Realising opportunities for
inorganic growth
Although our primary focus is to drive
organic growth by delivering on the
initiatives outlined above, we are
continuing to explore alternative growth
opportunities. These include specific
opportunities that are core and/or near
adjacencies to our current business
and underpinned by clear consumer
trends, while various participation
options are being explored.
This year, we have taken a more
deliberate approach to systematically
identifying and discussing potential
M&A opportunities through the creation
of an operational investment
committee, comprising the chief
executive officer, chief financial officer,
chief legal officer, and chief growth
officers, with monthly meetings
scheduled to maintain healthy pressure
on the system. We have re-established
our interest in M&A opportunities, both
in South Africa and the rest of the
continent, with key banking partners
and advisers across these geographies,
narrowing our categories of interest to
those that can provide a credible and
margin-accretive addition to the Tiger
portfolio. Although we analysed several
targets and opportunities this year,
none were the ideal long-term fit.
www.tigerbrands.com
PERFORMANCE
SUMMARY 2022
Positive developments
60% reduction in consumer complaints,
reflecting our focus on quality
New healthier product lines in the Snacks,
Baby, and Beverages categories
Material gains in volume market share
over last two years
28 external marketing awards
E-commerce gains beyond targeted
levels and within 1-2% of matching total
basket share
Completed first venture capital investment
in a future-focused foods space
Opportunities for
improvement
Recall of certain baby powder products
Scope to deepen use of big data
analytics and further entrench consumer
insights into our response
#2
MEETING THE
NEEDS OF
CONSUMERS
We are driving various strategic initiatives to
meet and beat the current and anticipated needs
of consumers, delivering market-leading solutions for
the value-conscious consumer, realising commercial
opportunities in health and nutrition and snackification,
and responding to significant changes in in-store
and online shopping dynamics.
Meeting the needs of value-conscious consumers
In 2020, the board approved a value-trend strategy for the business with three
strategic focus areas: driving our relevance in the value segment by highlighting the
benefits of our current brands through marketing and communication best practice;
meeting value-specific consumer needs through innovation and renovation; and
identifying and delivering commercially viable opportunities to manufacture private
label products to our benefit.
We have made some progress this year in each of these focus areas. In addition
to ongoing value-led marketing campaigns, we have driven value-for-money
innovations in certain categories to meet more affordable price points, including new
value packs in beverages, canned food, and personal care categories. In response
to growth in private label, we have been implementing our recently developed
guidelines on engagement with customers in this regard, and although we have
realised some specific private label manufacturing opportunities in categories where
manufacturing capacity exists, the contribution to revenue remains small.
We have a clear pipeline of value-led innovations, including new value packs
in groceries and beverages, and value offerings in groceries and beverages.
Delivery of these innovations will be aided by the accelerated rollout of revenue
management aimed at optimising promotional activity, cost savings projects that
help keep prices competitive, and our strategy for competing effectively in the deep
discounter channel.
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur performanceOur governanceOur businessOverviewOur strategy MEETING THE NEEDS OF CONSUMERS CONTINUED
www.tigerbrands.com
Realising commercial
opportunities in health
and nutrition
As Africa’s largest food company,
our health and nutrition agenda is
integral to our corporate purpose of
nourishing and nurturing more lives
every day. In addition to the broader
moral imperative of driving positive
change on health and nutrition, we
believe that there are valuable
opportunities for business growth in
leading this agenda in South Africa and
across the continent. We are looking to
realise these commercial opportunities
through our health and nutrition strategy,
which remains particularly relevant given
the state of nutrition in South Africa,
as well as pending labelling and
marketing regulations.
The strategy, which has been in place
for more than two years, includes
four key focus areas:
› Renovating our existing product
range to make more of our products
compliant with our “Eat Well Live
Well” standards, while striving
towards global best practice
› Innovating within our existing brands
and through new brands to develop
more nutritious, affordable food
products
› Educating consumers, in partnership
with government, academia and
NGOs, in a manner that allows them
to make better informed decisions
about their wellbeing
› Commercialising our portfolio to
drive growth.
We continued to make progress this
year in delivering on this strategy,
launching new healthy product lines in
the Snacks, Baby, and Beverages
categories, including a lower calorie
Energade beverages product, and a
new healthy snack offering. We have
also continued the rollout of clear and
simple consumer-relevant health claims
on various brands. Our innovation
pipeline includes lower-sugar, lower-
calorie beverages and grocery products,
new protein power offerings, and
health-led innovations in cereals, pasta
and beverages.
Responding to the
snackification trend
Our ongoing research confirms that
snacking trends continue to gain
momentum in South Africa. Initially
led by younger consumers, this trend is
now apparent across all consumer age
groups. We continue to drive innovation
and communication to capitalise on this
trend through our snackification strategy
that lays out our areas of focus over the
next five years. We will be exploring
multiple options to drive gains in this
space including through inorganic
growth and potentially some licensing
deals. Innovation remains at the heart
of our strategic focus; we will continue
to drive innovative launches, including
Tastic Rice Chips and ready-to-eat
cereal snacks, which build on the
successes of recent launches such as
Black Cat into the count-line bars and
slabs product categories. In launching
new products we are spending equal
effort in developing robust pipelines to
enter existing and adjacent categories,
aligned to our core and emerging
capabilities. We have built an improved
go-to-market capability that is being
continually refined to meet changing
market demands and consumer
preferences.
#3
OPTIMISING
OUR SUPPLY
CHAIN
We have maintained a particular focus this year
on further strengthening our product quality and food
safety practices, stabilising operational performance in
our supply chain, and implementing clear processes to
boost productivity, efficiencies, and workplace safety.
In addition to upgrading some of our factories and
investing in renewable energy, we have continued
to seek opportunities to deliver value from our
procurement and logistics activities.
Developing world-class manufacturing facilities
Investing in excellence in our manufacturing operations is a critical foundation
for Tiger Brands’ success. Through our operations support strategy and capex
programme, we are striving to build agile, fit-for-purpose operations that deliver
continuous improvement in productivity as efficiently and safely as possible,
ensuring product quality and enhanced environmental performance. We are placing
a particular focus on implementing and progressing manufacturing excellence
custom and practice (MECP) across all our plants, prioritising our activities this
year on ten sites with the greatest need for improvement. Our investment in plant
and equipment is supported by investment in competency-based training, talent
attraction and retention, and building a pipeline through management trainees
and apprentices.
This year, our capital expenditure amounted to R961 million, covering numerous
projects aimed at expanding capacity, optimising efficiency, replacing ageing
equipment, upgrading infrastructure, ensuring compliance, and realising innovation
opportunities. Specific projects included the multi-year investment in the relocation
and upgrading of our peanut butter plant, improving reliability at our pasta facility,
improvement in aerosol lines within Personal Care, and various automation and
digitalisation initiatives across our categories. In August 2022, we signed a power
purchase agreement with an independent power producer to introduce solar power
at four of our sites, with solar power generation expected to come on line at all of
these sites by March 2023. This forms an important step towards our goal of
sourcing 65% of our manufacturing electricity requirements from renewable
energy by 2030.
PERFORMANCE
SUMMARY 2022
Positive developments
9% improvement in OEE across our
focus sites over past three years
Achieved R354 million in savings
through improved MUV over the past
three years
Stabilised logistics infrastructure
for next three years, generating
significant savings
Approved capex projects managed
within time and on-budget
Four rooftop solar systems,
strengthening energy security
and reducing GHG emissions
Definitive plans for automation
rollout across six sites
Opportunities for
improvement
Further strengthening our
occupational safety measures
Meet lost-time injury frequency
rate (LTIFR) targets
Productivity improvements to match
or exceed our OEE improvements
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TIGER BRANDS’ VENTURE
CAPITAL FUND – FIRST
INVESTMENT IN PLANT-
BASED AND VEGAN
COMPANY
Our R100 million Venture Capital
Fund was set up in mid-2021 to
support up-and-coming consumer
brands in the food and beverage
sector. This forms an important part
of our strategy to stay ahead of the
curve in terms of key consumer
trends, to ensure that we are better
able to address the evolving needs
of our consumers, and to give us
access to exciting new developments
in emerging brands and technologies.
The fund’s first investment, made in
March 2022, was in Herbivore
Earthfoods, a company founded in
2014 with the goal of making healthy,
plant-based foods accessible and
affordable in South Africa. Through
our investment in Herbivore
Earthfoods – which includes financial
capital, as well as support in the form
of distribution, brand building, and
research and development – we are
partnering with the company to
provide the necessary scale to make
plant-based foods more accessible
for the South African consumer.
Since our investment, Herbivore has
acquired additional machinery to
increase capacity and drive innovation,
with their recently launched crumbed
range and additional dairy-free offerings
gaining traction. The partnership with
Tiger Brands has enabled the
company’s first foray into the food
service and quick service restaurant
market, leveraging the strategic
expertise of our out-of-home team.
The Venture Capital Fund has a strong
pipeline of opportunities which are in
the process of being evaluated,
particularly within health and nutrition
and snackification.
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur performanceOur governanceOur businessOverviewOur strategy OPTIMISING OUR SUPPLY CHAIN CONTINUED
Our investment in plant and equipment
is supported by investment in safety
performance, competency-based
training, talent attraction and retention,
and building a pipeline through
management trainees and apprentices.
Capital expenditure of R1,6 billion has
been earmarked for FY23, of which
R403 million has already received
the prerequisite approvals. These
investments are underpinned by
replacement and maintenance aimed
at optimising efficiencies and realising
innovation opportunities while
supporting our commitment to health
and safety compliance. The most
significant projects include the relocation
and upgrade of our peanut butter plant,
upgrade to the aerosol canning line, a
new oats flaking plant and structural
improvements at the Sorghum facility.
The focus at the ten priority plants is
to sustain the momentum of achieving
improvements in OEE, with a clear
focus placed on safety performance,
entrenching MECP practices, filling
priority vacancies and developing
competencies and ensuring effective
maintenance practices. It is pleasing to
report that we have achieved a 9%
improvement in OEE across our focus
sites over the past three years, with
Tiger Brands now inside the “Best in
Class” definition area for overall OEE.
In addition, over the same period, we
have achieved R354 million in savings
through MUV.
Despite our various occupational safety
training, assessment and auditing
initiatives, it has been a disappointing
year in terms of safety performance,
with the tragic fatality of one Albany
driver and two contractors reflecting a
broader increase in employee injuries
with our lost-time injury frequency rate
(LTIFR) of 0,45. This year we have
improved our internal safety monitoring
and reporting process, and changed
our methodology for calculating LTIFR
to ensure greater consistency with
our peers for benchmarking and
assessment purposes.
Embedding a product
quality approach
Although we have continued to make
progress this year in embedding a
strong quality culture, supported by
qualified people and robust integrated
management systems, we recognise
that more still needs to be done in our
drive to ensure world class product
quality and consumer safety practices.
Our overall quality performance
improved significantly this year, with a
14% reduction in consumer complaints.
This progress, off the back
of significant improvements in the prior
year, was unfortunately overshadowed
by a recall of certain baby powder
products. The recall was instituted as
a precautionary measure in the best
interests of consumers after trace
levels of asbestos were detected in
test samples from a batch of
pharmaceutical-grade talc powder used
as a raw material in the production of
our baby talc powder products. The
trace levels of asbestos detected in the
test samples were so low that it could
not be quantified by the standardised
testing methodology used. We have
undertaken a root cause analysis and
are implementing various corrective
actions.
Last year we introduced a new supplier
quality assurance (SQA) protocol –
informed by a detailed supplier, raw
material, and packaging risk matrix –
as part of a structured process to
strengthen the management of our
supplier quality assurance. We
introduced a more robust supplier audit
programme and have been working
with suppliers to proactively identify and
address areas of potential risk. We have
prioritised a number of suppliers and
third-party manufacturers to be
physically audited next year, based on
an assessment of potential risks.
In our own operations, we have
ensured that HACCP risk and control
measures are in place across our
facilities. We have identified high-risk
areas and implemented the necessary
critical control measures, introducing
new automation and in-line inspection
technologies where needed, and
validating our quality testing, sanitation
and finished good release protocols.
We are continuing to conduct quarterly
self-assessments against the Global
Food Safety Initiative (GFSI)
requirements, as well as self-
www.tigerbrands.com
assessments against Tiger Brands’
quality standards. All but three of our
manufacturing units are certified to
the global FSSC 22000 standard, a
GFSI-recognised food safety certification
scheme; the three remaining units are
currently on HACCP certification and
will progress to FSSC 22000 certification
next year. All 23 of our external
warehouse facilities (Tiger Brands
facilities and third-party warehouses)
were externally audited this year and
certified against the Brand Reputation
through Compliance (BRCGS) Global
Standard for Storage and Distribution.
Tiger Brands has been a member of
the European Hygiene Engineering and
Design Group (EHEDG) since 2019 and
we use their detailed guidelines and
expertise to enable best practice across
our operations on hygienic design and
food quality safety. We also renewed
our sponsorship of the Centre for Food
Safety, an applied food-science research
consortium at Stellenbosch University
that works with the food industry and
other stakeholders on food safety
challenges. Our teams have continued
to benefit from the centre’s valuable
technical support and advice on food
safety and microbiological risk
assessments.
Enhancing the centralised
procurement capability
This has been a challenging year for
procurement, with continuing global
supply chain constraints and increasing
inflationary pressures resulting in the
procurement team having to focus all its
efforts on securing supply rather than
unlocking new value. Together with the
need to adequately resource the team,
these challenges have hampered our
ability to deliver on our ambition of
transitioning to a world-leading
procurement function that drives an
improved bottom-line and serves as a
key source of competitive advantage for
the group.
Globally we have seen some significant
changes in corporate procurement
priorities in recent years. While cost
savings remains the strongest priority,
there has been a heightened focus on
supplier risk management and ensuring
strong ESG/sustainability practices
across the supply chain, with issues
around digitisation, talent management,
and innovation also gaining importance.
Within this context, we have been
working over the past few years to
centralise our procurement function into
a single hub that manages the strategic
sourcing of major spend items – such
as ingredients and fresh produce,
packaging, and logistics – as cost
effectively as possible, leveraging scale
both internally and externally with the
aim of establishing the group as a price
maker and not a price taker.
We recognise that much needs
to be done if we are to match the
procurement performance of leading
local and global peers. We believe there
is an opportunity to unlock value of
around R500 million within the next
two years, if we strengthen our core
procurement capabilities, complete the
realignment of our centralised operating
model, and ensure priority investment in
the right digital tools and technology.
We are working to redefine our
governance and processes to
significantly increase capacity, using
digital tools to drive a step-change in
operational efficiencies, risk remediation
and improved sourcing effectiveness.
We will be strengthening the
commonality of processes – such as
category management, supplier
management and operating process –
centralising our investment in talent, and
ensuring more effective collaboration
with our business units to optimise
costs and drive growth.
Transforming our
logistics activities
Last year we launched an ambitious
logistics transformation programme
aimed at positioning the logistics
function as an important source of
strategic advantage, realising significant
costs savings and improving overall
efficiencies. This programme covers
12 broad focus areas and several
individual projects with the goal of
developing a function that is self-
sufficient and agile, where we have
full ownership of the intellectual property
and data, as well as improved overall
visibility and management of the logistics
process, delivering a significant
reduction percentage in logistics costs.
Through this initiative we have brought in
a new warehouse management system
that has already been implemented at
one of our warehouses, with
implementation imminent at other sites
next year. We are currently reorganising
our customer support centre, which will
start operations in March 2023. We have
introduced a pallet optimisation initiative
at some of our facilities, which is
expected to yield material savings in
transport costs as soon as next year;
the business case for additional
opportunities is being assessed in other
operations for potential launch next year.
The first phase of a project to improve
the management of logistics providers,
and integrate forecasting with
replenishment planning, has been
completed. We are confident that these
various initiatives will deliver significant
savings by getting the basics right,
ensuring full ownership of intellectual
property and data, freeing us from
potential hold-ups by service providers,
and improving overall visibility and
management of the logistics process.
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur performanceOur governanceOur businessOverviewOur strategy www.tigerbrands.com
stock across our warehouse distribution
network and reduced dependency on
external service providers.
Looking ahead, we have approved
new projects to improve operational
efficiency and increase automation
across the supply chain including
warehouse management; demand
planning and forecasting; safety,
security, and environmental
management; food quality monitoring
and reporting; integrated budgeting and
reporting and forecasting capability;
and procurement operations
management.
#4
BEING OBSESSED
ABOUT COST
SAVINGS AND
EFFICIENCY
We have realised R387 million in savings this year,
reflecting our drive in instilling a culture of cost savings.
PERFORMANCE
SUMMARY 2022
Unlocking costs and cash
In 2020 we introduced a culture-change initiative aimed at ensuring a more
systemic group-wide approach to driving efficiencies across the business,
and to enhancing the quantity and quality of projects that are being identified
and tracked. As part of this initiative, we introduced clear process steps from
identification to realisation of savings, improved internal transparency and
strengthened our accountability measures to ensure appropriate ownership of
expenses. We have set up revenue management capabilities to help us identify
cost savings and efficiencies and to create a pipeline of opportunities across the
business units, and we prioritised the need to improve our SKU rationalisation by
developing an accurate product costing model informed by activity-based costing.
We have made further progress this year in embedding this cost-savings culture
across the group, delivering R387 million in savings, short of our target for the year
due to inflationary pressure in procurement. Our revised accountability matrix is
helping to ensure greater ownership in delivering the targeted savings, creating a
healthy tension between cost owners and business owners, aided by introducing
appropriate incentive structures to drive performance and ownership.
We have been further strengthening our central revenue management capability
within each of our business units, delivering positive results in Groceries,
Beverages, and Snacks & Treats. Our new trading terms, designed to provide
stronger pay-for-performance incentives and ensure compliance with new
legislation, are showing encouraging signs of delivering results. We have
continued to deliver valuable costs savings and reduce complexity through
further portfolio optimisation and SKU rationalisation, primarily in Groceries,
Snacks & Treats, and Beverages.
Positive developments
R1,4 billion in cost savings realised over
the last three years
Rejuvenated costs savings culture with
launch of Every Tiger Counts initiative
Revenue management initiatives
implemented, delivering R300 million
cumulative benefit since inception
Digitalisation strategy in-place and driving
decisions
IT spend moves closer to benchmark
levels and delivering on commitments
Opportunities for
improvement
Strengthen the procurement function and
position as a competitive advantage
Continue to deepen our cost-efficiency
culture change
Delivering digital
transformation
Delivering digital optimisation,
and providing integrated IT and
information solutions, is an increasingly
significant source of competitive
advantage and critical to realising
our vision of developing an effective,
best-in-class supply chain. We have
completed the development and
approval of a comprehensive digital
strategy that defines the key areas
of focus for the business and serves
as a comprehensive framework and
roadmap for our business initiatives
over the coming years. Through this
process we have a clear view of the
required initiatives and a process for
prioritising them, while ensuring that
the initiatives all align to deliver business
value across the enterprise.
Thus far our technology investments
have focused on five key areas:
operational efficiency, automation, data
and analytics, revenue optimisation,
and security. Our new customer service
and logistics centre programme has
enabled more accurate stock transfers,
while our pallet-tracking solution has
improved traceability throughout the
order to deliver process. We have
delivered efficiency improvements by
reducing the number of systems used
for the financial close process, as well
as through automatic account
reconciliation, and we have
strengthened our revenue management
and growth decisions through improved
analytics on our customer and sales
data. Deployment of the recently
introduced distribution requirements
planning system has improved
accuracy and efficiency in allocating
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur performanceOur governanceOur businessOverviewOur strategy #5
IGNITING
OUR PEOPLE
For Tiger Brands to perform, innovate and
grow, the “Future-fit Tiger” employee must be
consumer obsessed, an excellent executor, collaborative,
agile, innovative and resilient, centred by our purpose,
values and winning behaviours.
PERFORMANCE
SUMMARY 2022
Our people strategy is designed to ignite a culture of consumer obsession, agility,
and a risk-embracing growth mindset that will accelerate innovation and enable
us to win in the market. Through our three strategic pillars of talent, leadership and
great place to work, we are building a diverse talent base, developing leadership
capability, and creating a work environment that liberates people
to focus on the consumer, and deliver on our purpose.
Positive developments
40% leadership vacancies filled internally to
date against our target
of 50%
Accelerated core capability in manufacturing,
customer, marketing and R&D
Launched an accelerated leadership
development programme to improve
succession planning
Further improvements in
diversity metrics
Voice of Tiger employee engagement
process informing actions to improve culture
and engagement
Opportunities for improvement
Industrial action at two of our facilities
including a prolonged
strike at Snacks & Treats
Filling of vacancies and
developing bench-strength
Deepen commercial capability
of the marketing team
Reduce senior management
attrition rate
Building a diverse talent pipeline
Over the last three years we have built a strong foundation for our talent
management process across the organisation, identifying the critical commercial
and technical capabilities needed to execute our strategic agenda and improving
our internal rate of leadership appointments to above 40%, up from 20% in 2018.
Unfortunately, as with many of our peers locally and internationally, our talent
management efforts have been impacted by higher post-Covid-19 attrition rates,
compounded in South Africa by a general skills shortage in some technical areas
critical to our business. This year, our attrition rate in key technical roles and at
senior leadership levels averaged 13%, down from a peak of around 17% over the
prior two years, and below the South African average of 16%. This challenging
attrition rate, together with the internal moves that we have accelerated over the last
three years, has seen us depleting our talent pipeline in middle to senior leadership
levels, necessitating an urgent focus on talent acquisition from external sources and
a renewed focus on developing capabilities internally.
We have taken various actions to address these challenges, creating a
talent acquisition hub in March 2022 to accelerate targeted resourcing and
talent pipeline building for the whole organisation, with a focus on critical roles.
We have undertaken targeted engagements across the business, implementing
learning plans to address core competencies, strengthening proactive career
development opportunities through targeted programmes such as our WINGS
accelerated development programme and refreshed learning academies, and
refining our reward and recognition strategy to attract and retain high calibre talent
and motivate winning performance. More specifically, the remuneration committee
approved once-off retention awards for Exco members (excluding the CEO) to
manage the retention of Exco members, which is imperative to the stability of our
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strategic and operational support
teams. Although our efforts have
started to yield positive results, the
sourcing of critical skills remains a top
priority. To fill roles more quickly, we
have widened our talent mapping and
sourcing efforts beyond our immediate
peers in the sector, particularly at senior
management levels.
Learning and development
Our foundational talent development
programmes for each employee
segment are designed to ensure the
steady development of capabilities
needed to drive performance now and
fill our talent pipelines for the future.
We have refreshed our learning
academies this year, focusing on
Supply Chain, Marketing, Customer,
Bakeries and R&D, and accelerating
the focus of the academies toward
developing identified fit-for-purpose
capabilities. We have taken advantage
of the opportunities presented by
remote-working arrangements to
embed the use of just-in-time digital
learning to accelerate the integration of
learning into day-to-day work across
the organisation. This year, we spent
R97 million on learning and
development across all sites and
businesses. We had a total
of 278 employed learners and
96 unemployed learners actively
participating in accredited skills
development interventions, such as
learnerships, apprenticeships and
internships. In addition, 34 people with
disability learnership candidates joined
our organisation to further build our
talent pipeline and address our
diversity, inclusion and transformation
objective.
Diversity and inclusion
We are continuing to execute our
diversity strategy to strengthen
African, Coloured and Indian (ACI)
representation in our workforce,
champion women in the workplace,
and make progress with the inclusion
of people with disabilities. In 2022,
94% of our workforce is ACI, and on
average 81% of internal leadership
placements were filled by ACI
employees. The representation of ACI
employees at management level is
65% in middle management, 58% in
senior management, and 60% in top
management. Our management trainee
intake in 2022 was 100% ACI. Our
gender equity agenda is addressed
through various targeted talent and
leadership development programmes,
while the Tiger Women’s Network
provides a forum for female employees
to network, dialogue and have access
to tailored mentorship, coaching
and development opportunities.
We have integrated dialogues about
unconscious bias into our leadership
development programmes and
culture transformation engagements.
In 2022, 31% of our workforce is
female, with female representation
at management level being 41% in
middle management, 42% in senior
management, and 30% in top
management. Our management trainee
intake in the last year was 66% female.
Developing leadership
capability
We have a longstanding focus on
developing leadership capabilities
across the organisation to drive
performance, support the wellbeing of
employees, and lead the transformation
of our culture. This year, to further
accelerate the building of leadership
succession pipelines, we have
established and are piloting a high
potential accelerated development
programme (WINGS), for internal and
external talent, that will enable us to
rotate key talent across our businesses
and prepare them at a faster rate for
key leadership positions. This
programme is open for internal and
external talent, and our first cohort of
WINGS delegates are participating in
the programme. Our existing flagship
leadership development programmes,
Game Changer and LIFT, remain
effective at embedding core leadership
competencies, and work well in
combination with mentorship and
coaching through our Leader-as-Coach
programme. This year, 92 employees
participated in the LIFT programme,
and 46 completed the Game Changer
programme.
We measure the progress of our
leaders using a 360° MultiRater
feedback platform that captures
feedback on their ability and behaviours
directly from their teams, peers and
line-leaders. Our targeted leadership
rotations are designed to strengthen
our leadership pipeline and stimulate
innovation and a growth mindset
across our leadership talent pool.
Looking ahead, we will continue
executing our future-fit leadership
development programmes and
rotations to strengthen our leadership
pipeline, as well as to stimulate
innovation and a growth mindset
across our talent pool.
Creating a great place to work
Transforming our culture and
creating a great place to work remains
a critical focus for the organisation.
The culture we aspire to has been
clearly articulated – agile, innovative,
collaborative and execution-focused –
and our culture transformation roadmap
guides us towards realising this vision.
Our Voice of Tiger (VoT) employee
experience and engagement survey
is a key tool that informs the work of
transforming our culture. Our last
VoT survey was conducted in
November 2021, and our activities
this year were focused on addressing
the key employee engagement
opportunities identified. Employee
participation in the survey remained at
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur performanceOur governanceOur businessOverviewOur strategy IGNITING OUR PEOPLE CONTINUED
73%, with the overall employee
engagement score declining slightly
from 70 to 66, in line with global trends.
This indicates a generally positive work
experience among employees, yet with
definite room for improvement. We will
conduct the next VoT survey in
November 2022 to gauge our progress,
and inform further actions in 2023.
Employee wellbeing
The Covid-19 pandemic has
fundamentally reshaped the employer-
employee relationship, with
acknowledgement and respect for the
unique lives and experiences of
different employees becoming critical
to success. We have further humanised
the employee-employer relationship in
ways that are starting to unlock value
through increased performance,
engagement and talent market
attractiveness. We have embraced
hybrid and flexible work arrangements
to meet the need of employees for
personalised work conditions and
autonomy in choosing where and when
they work. Our employee wellbeing
programme, THRIVE, is playing a
critical role in enabling our people and
their families to seek help, find safety
and support, and build the resilience
needed to navigate work-life integration
issues, and address physical, emotional
and mental-health challenges.
Reward and recognition
We reward winning employee
performance to motivate excellence
and enhance our ability to attract,
develop and retain high-calibre talent.
We review and refine our reward and
recognition strategy annually to
stimulate performance, align with
market benchmarks, and meet the
interests of our employees and
shareholders. We reward performance
fairly and responsibly, in accordance
with the reward philosophy outlined
in our remuneration policy, and in
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alignment with International Labour
Organization (ILO) conventions and
relevant national legislation.
Our remuneration strategy is aligned
with the key performance indicators
(KPIs) used to measure and reward
performance against our strategy.
Our reward framework follows a
“total reward” approach, consisting
of guaranteed pay and variable pay,
and a range of market-relevant benefits
and professional growth opportunities
that recognise individual and team
performance. Our short-term incentive
(STI) scorecard has been revised to
strike a better balance between a focus
on financial and non-financial strategic
aspects of performance. Remuneration
incentives are indirectly linked to
sustainability performance via weighted
measures for achieving strategic
objectives in efficiency, quality and
safety. Further details are provided in our
remuneration report on
pages 75 and 76.
In recent years, the rewards issued to
employees through our LTI and STI
schemes have been less attractive due
to lower levels of business performance
and the impact of Covid-19. However,
this has started to change in the last
two years, as business performance
has started to improve. Eligible
employees received STI payments in
2021, and will receive further payments
in 2022 based on the achievement of
performance KPIs. Our in-person
employee recognition ceremonies and
channels also took a hit as Covid-19
kept employees at home and away
from the office. Our refreshed
recognition platform, Tiger Stripes, has
reinvigorated the practice of giving
regular recognition for a job well done.
These incremental votes of recognition,
culminate in our annual Tiger Stripes
Awards ceremony.
Employee relations
We aim to build and maintain
meaningful collaborative relationships
with employees and representative
trade unions. Our employee relations
partnership framework guides our
approach, and we work continuously
through direct engagements and site
partnership forums to maintain a
stable employee relations environment
across all our sites. Our CEO and
executive team are involved in
employee relations engagements on
strategic issues, including engagements
with trade union partners. We align and
comply with all labour-related legislation
and ILO conventions relevant to the
countries where we operate.
In 2022, we invigorated more regular
engagements between site leaders,
staff and union partners on matters
of mutual interest. Our intention is for
increased interaction to support
relationship building, and thereby help
us address challenges more proactively
together before they become disruptive
conflicts. We have improved our
management of non-compliant
overtime, and we have seen a reduction
of cases across our sites. There have
been no instances of non-compliance
with labour standards.
This year, we successfully concluded
27 planned site negotiations without
industrial action. Regrettably, we
experienced one protected strike at
our Snack & Treats site in the first
quarter due to a wage dispute. The
strike commenced on 8 November
2021 and employees returned to work
on 20 December 2021, with a total of
279 079 manhours lost. Our efforts to
stabilise the situation at this site are
starting to yield positive results, and
we are leveraging the recent challenge
as an opportunity to build a stronger
relationship with our employees going
forward.
www.tigerbrands.com
#6
INVESTING IN
A SUSTAINABLE
FUTURE
Our sustainable future
strategy supports delivery
on our core purpose,
communicates our forward-
looking approach to
sustainability, and orients
the business towards
improved environmental,
social and governance
(ESG) performance.
The strategy articulates our societal
value-proposition and reflects our
commitment to addressing our most
material impacts and to creating
broader social, economic and
environmental value.
The strategy comprises three clear
focus areas: health and nutrition;
enhanced livelihoods; and environmental
stewardship. Our commitments under
these pillars drive the pursuit of
commercial opportunities in health
and nutrition, the systematic
transformation of our supply chain
to promote more inclusive economic
development, and the adoption of
environmentally responsible production
practices. These goal areas are
underpinned by a set of critical
anchors, relating to the following areas:
food safety and quality; ethical supply
chain practices; safety, health and
environment; responsible marketing;
and transparency, partnerships and
stakeholder responsiveness.
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur performanceOur governanceOur businessOverviewOur strategy INVESTING IN A SUSTAINABLE FUTURE CONTINUED
www.tigerbrands.com
Health and nutrition
Enhanced livelihoods
Environmental stewardship
CRITICAL ANCHORS
OUR COMMITMENTS AND KEY ACTIONS
Safety and health
Food safety and quality
Purpose-led culture
OUR COMMITMENTS AND KEY ACTIONS
We strive for zero injuries and have committed
to ensuring strong behavioural safety, health and
security performance, and visible, felt leadership. We
have a holistic health and safety programme with
clear roadmaps and deliverables, supported by a
behavioural safety programme that drives leadership
accountability and responsibility.
We are committed to ensuring superior
product safety and quality, and are determined
to continually raise the bar on our performance
to develop capabilities that differentiate us
from our competitors.
OUR 2022 PERFORMANCE
Food safety and quality
› Proactively recalled baby powder products
› 14% reduction in consumer complaints
(2021: 25%)
› All sites manufacturing sites certified against FSSC
Safety
› Three fatalities (2021: Zero)
› 0,45 lost-time injury frequency rate (LTIFR)
(2021: 0,31)
› 80 route-to-market incidents (2021: 106)
22000 or HACCP
› Completed external audits for all
warehouse facilities
Our people strategy is designed to enable execution
of our business strategy and growth agenda by
igniting a culture of consumer obsession, agility and
a growth mindset that accelerates innovation and a
winning performance. Through the three pillars of
talent, leadership, and a great place to work, we
build a diverse talent base, develop leadership
capability and create a work environment that
empowers our people to focus on the consumer and
deliver on our purpose.
Creating a great place to work
› 73% employee participation rate in VoT survey
› Employee engagement score of 66 is in line with
global trends
Diverse talent
› 31% female workforce (2021: 31%)
› 84% ACI in junior management and 60% at top
management (2021: 63% junior and top
management)
For more detailed disclosure on our sustainability and ESG performance, please see the Tiger Brands sustainability report 2022,
available at:
www.tigerbrands.com/sustainability/reporting
We are committed to enabling consumers to
improve their health and wellbeing by providing
food products that are more nutritious and
affordable, developing best-in-class nutritional
standards, and leveraging our brand and
marketing activities to promote consumer
nutrition.
We will improve the livelihoods of thousands
of people by providing opportunities across our
value chain for inclusive economic
participation, including the provision of
financial and non-financial support to
black-owned and black women-owned
enterprises and smallholder farmers, through
our supplier and farmer development
programmes, and preferential procurement
policies. In addition, we contribute
at least 1,5% of net profit after tax annually,
towards socio-economic development activities
that promote sustainable thriving communities.
We will improve our environmental
performance by implementing innovative
solutions that optimise energy and water
consumption in our operations, reduce the
negative impacts of packaging, and minimise
waste, effluent and emissions. We are
exploring opportunities for circular economy
initiatives that stimulate sustainable economic
opportunities, as well as leveraging our brand
and marketing to inspire positive behaviour
change in consumers.
2030 targets
› Empowering Good Nutrition choices for
100 million African consumers annually
› 75% of our food basket meeting EWLW
standards
OUR 2022 PERFORMANCE
20 community enterprises
2030 targets
› Create 4 000 new jobs
› Support 1 000 black enterprises and
› ESD fund of R400 million through
› 50% of total procurement spend on black
and black women-owned suppliers
› 100% of products ethically sourced
partnerships
sites from renewable sources
2030 targets
› 65% of electrical energy at manufacturing
› Energy and water intensity reduced by 30%
› 45% reduction in GHG emissions (scope
› Zero waste to landfill at all sites
› 50% reduction in food waste produced
› 100% of plastic packaging is recyclable/
› Total plastic packaging (volume) to contain
compostable
1 and 2)
at least 50% recycled plastic
model
farming sector
(2021: R85 million)
Enterprise supplier development
› R104 million ESD (Dipuno) Fund
› 67 farmers supported under aggregator
› 271 permanent jobs created in small-scale
› R54 million spend on agricultural projects
Preferential procurement (PP)
› R14 billion spend with B-BBEE-verified
› R7 billion spend with black-owned
enterprises (2021: R5 billion)
› R5 billion spend with black women-owned
suppliers (2021: R14 billion)
enterprises (2021: R4 billion)
Broad-based black economic
empowerment (B-BBEE)
› B-BBEE Level 2 (2021: Level 2)
Socio-economic development
› R26 million total SED spend (2021:
› 58 048 reached through Family Food
› 300+ schools reached through EduPlant
R23 million)
programme
(scope 1) GHG emissions
Climate and energy
› 13% (YoY) reduction in absolute direct
› 13% (YoY) reduction in GHG emissions
› 7% (YoY) reduction in absolute energy use
› 8% (YoY) reduction in electrical energy
intensity
intensity
Water
› 8% (YoY) reduction in absolute water use
› 7% (YoY) reduction in water-use intensity
Waste
› Waste reduction projects at site level,
diverting organic waste from landfill to
animal feed
intensity
› 32% (YoY) reduction in waste to landfill
› 70% of plastic packaging is recyclable
› Working through CGCSA on industry
food-waste reduction framework
product innovations launched
More nutritious products
› Various new nutritious and affordable
› Micronutrient enrichment across >30%
› Product lifecycle management system
of portfolio
baseline launched
Nutritional standards
› Introduced three-tier nutritional
categorisation of our products
Consumer health awareness
› R76 million spent on marketing health and
nutrition products; 10,2% of total marketing
spend
› KOO TV show promoting fruit and vegetable
consumption continued for second season
› R3,3 million EWLW spend
Food labelling
› 100% adherence to EWLW and Be-Nutrient-
› Continue to support clean-label pouches
Wise standards
through new Purity fruit products
Nutrition-led CSI
› Initiated Isondlo, a R42 million nutrition
programme supporting 10 000 food-insecure
children (five years of age and younger) and
their families, with monthly food hamper for
nine months
› Tiger Brands Foundation serves its
100 millionth meal
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur performanceOur governanceOur businessOverviewOur strategy CHIEF FINANCIAL
OFFICER’S REVIEW
DEEPA SITA CHIEF FINANCIAL OFFICER
The year under review can be characterised as a year of
two halves. The first half was impacted by a lag in recovering
unprecedented and unanticipated levels of cost inflation.
This was compounded by certain supply constraints as a
consequence of global and local supply chain challenges
and industrial action at Snacks & Treats and Bakeries.
The second half performance, despite a continuation
of the cost and supply challenges, exacerbated by prolonged
periods of loadshedding, reflects the effective implementation
of category specific margin recovery initiatives, as well as the
execution of specific initiatives in Bakeries, Snacks & Treats
and Exports. In addition, the Deciduous Fruit business
benefited from improved global fruit pricing and a weaker
exchange rate.
TOTAL REVENUE FROM CONTINUING OPERATIONS
INCREASED BY 10% TO R34,0 BILLION, DRIVEN BY
PRICE INFLATION OF 11% AND A MARGINAL
OVERALL VOLUME DECLINE OF 1%.
Volume growth in Exports and International was offset by volume declines
in the Domestic Business, primarily attributable to Milling and Baking,
Snacks & Treats, and Baby, as well as Home and Personal Care. These
volume declines were partially offset by good volume growth in Rice,
Beverages, Groceries, and Out of Home.
Although slightly lower than previously guided, cost-saving initiatives and
supply chain efficiencies continued to make a positive contribution to
the results. Together with further progress in revenue management,
this resulted in the overall gross margin being maintained at to 30,3%
relative to the prior year (excluding the impact of the product recall and civil
unrest). Group operating income (before impairments and non-operational
items) increased by 53% to R3,4 billion. Operating income for the current
period includes insurance proceeds of R52 million in respect of last year’s
product recall and R166 million in respect of the civil unrest, which occurred
in July 2021. Last year, the group’s operating income was impacted by
once-off costs related to the product recall (R647 million) and civil unrest
(R85 million). Excluding the pre-tax impact of these costs as well as the
benefit in the current period of the insurance proceeds as referred to above,
operating income increased by 10% compared to the prior year whilst group
operating margin remained unchanged at 9,6%.
Income from associates increased by
38% to R478 million. Good underlying
trading performances from Carozzi
and National Foods were augmented
by a profit on disposal of an associate
investment in National Foods and
favourable currency translation gains
at Carozzi.
Net financing costs for the year
amounted to R75 million compared to
R54 million last year. This was due to
higher average debt levels and higher
interest rates compared to the prior
year. Debt during the year was
impacted by higher raw material
inventory levels and the impact of the
share buy-back programme. A net
foreign exchange gain of R46 million
resulted from the translation, in the
current year, of foreign currency cash
balances at a weaker average
exchange rate, while last year there
was a net foreign exchange loss of
R9 million due to the strengthening
of the rand against major currencies.
www.tigerbrands.com
The group’s effective tax rate before
impairments, fair value losses,
non-operational items and income
from associates, increased slightly
to 29,4% from 29,1% last year.
The share buy-back programme
amounting to approximately
R1,5 billion, which was executed during
the year, reduced the weighted average
number of shares in issue by 1,9% to
162 552 439.
Earnings per share (EPS) from
continuing operations increased
by 65% to 1 762 cents (2021:
1 070 cents), while headline earnings
per share (HEPS) from continuing
operations increased by 51% to
1 702 cents (2021: 1 127 cents).
Excluding both the impact of the
product recall and civil unrest in the
prior year, as well as the benefit of the
related insurance recoveries in the
current year, HEPS from continuing
operations increased by 11%.
EPS from total operations increased
by 54% to 1 762 cents (2021:
1 142 cents). Similarly, HEPS from
total operations increased by 51% to
1 702 cents (2021: 1 127 cents).
Differing performance across
our divisions
This year we saw mixed performance
across our divisions, with continued
solid performances in Rice, Beverages,
and Groceries, and pleasing volume
growth in Exports, International and Out
of Home, offset by volume declines in
other areas of our domestic business.
In Grains, revenue benefited from price
increases across the Milling and Baking
segments, and a strong volume
performance in Rice. Operating income
generated by the wheat-to-bread value
chain was significantly higher than in
the first half although flat on the second
half comparative period and therefore
the full year performance reflects the
significant decline reported at the
end of the first half. The improved
performance of the value chain in
the face of both pricing pressure and
significant cost escalations, reflects
the impact of a refreshed leadership
and management team in executing
on initiatives aimed at driving volume,
price/volume management, quality
and internal efficiencies. Volume
performance has been pleasing with
the double-digit declines of the first
quarter reversed with solid growth in
volume achieved in the fourth quarter.
Our sorghum-based breakfast and
beverages business delivered a muted
performance, impacted by supply
challenges and lower demand.
Although our Jungle and Pasta
businesses delivered solid revenue
growth, profitability was impacted by
higher input and distribution costs,
and sub-optimal factory performance.
Within Consumer Brands, all
segments delivered top-line growth with
a particularly strong performance from
Out of Home in line with increased
post-lockdown demand. Groceries
benefited from innovation, particularly
in cost-competitive value packs and
price-pack solutions for value-seeking
consumers. Snacks & Treats recorded
a strong second-half recovery following
supply challenges in the first half due
to labour disruptions and low opening
inventory levels, while Beverages
operating income was impacted by
higher raw material costs, ingredients,
and packaging inflation.
Home and Personal Care’s top line
was unable to recover from a poor start
to the year, with unfavourable weather
conditions impacting category demand
for pesticides, compounded by
increased raw material and packaging
costs.
We saw a pleasing turnaround
in performance in Exports and
International, driven primarily by
an improved performance from the
Deciduous Fruit business, which
benefited from higher international fruit
prices, favourable exchange rates, and
improved volumes. We are continuing
to engage with affected stakeholders
to identify mutually beneficial solutions
regarding the future of our deciduous
fruit business, Langeberg and Ashton
Foods (LAF). We have reopened the
sale process together with our advisers
and will continue to operate the
business through to the end of the
current season in May 2023. Elsewhere,
Chococam’s revenues increased by
10%, off the back of volume growth
and price inflation, reduced by an
unfavourable foreign currency
translation. Volumes were driven by
optimal pricing strategies, an improved
distribution network in key markets and
market share gains in chocolate.
Further details are provided in the
operational review.
Cash flow and capital
expenditure
Continued investment in working capital
due to increased stock holdings,
particularly on raw material purchases
as well as due to the rebuilding of
inventory levels at Groceries and
Snacks & Treats, resulted in cash
generated from operations declining
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CHIEF FINANCIAL OFFICER’S REVIEW CONTINUED
to R2,6 billion from R4,0 billion in FY21.
This is line with the strategy to carry
higher stock levels to ensure continuity
of supply due to ongoing global and
local supply chain disruptions. The level
of investment is further exacerbated by
the unprecedented levels of inflation
over the past year. Capital expenditure
for the year amounted to R961 million
(2021: R1,0 billion), while the cash
position was further impacted by the
completion of the general share
buy-back programme. The group
ended the period in a net cash position
of R143 million (2021: R2,2 billion).
Share buy-back programme
As previously disclosed, the board
approved a share buy-back programme
to return cash to shareholders over and
above ordinary dividends.
In line with the general authority granted
by shareholders for the company to
acquire shares from its shareholders,
the buy-back was limited to 5% of the
issued share capital of Tiger Brands.
On 20 July 2022, the company
completed the repurchase up to the
limit of the general authority, acquiring
9,49 million shares at a total cost of
R1,5 billion. All the shares repurchased
have been cancelled.
Given the company’s ungeared
balance sheet and in the absence of
any significant or imminent corporate
activity, the board will continue to
consider a share buy-back programme
as part of its capital allocation
deliberations.
Final ordinary dividend
The company declared a final ordinary
dividend of 653 cents per share for
the year ended 30 September 2022.
Together with the interim dividend of
320 cents per share, this brings the
total dividend for the year to 973 cents
per share, a 18% increase relative to
last year. In calculating last year’s total
dividend, HEPS was adjusted to
exclude the costs of the product recall
and the civil unrest. This year, the
company’s dividend policy of 1,75x
cover was applied to HEPS, inclusive of
insurance proceeds received in respect
of these events.
potentially available within our
procurement and logistics activities.
In response to the constrained
consumer environment, we have
accelerated value-led innovation and
renovation including price-pack
architecture solutions across key
segments of the portfolio. In addition,
we have various initiatives with
customers aimed at strengthening
our position at the point of purchase.
Shareholders are referred to the
accompanying dividend declaration
for further details.
Outlook
The year ahead is likely to remain
challenging. Persistently high
unemployment and inflation levels
together with higher interest rates,
will place further pressure on over-
extended consumers. In addition
to local and global supply chains
remaining volatile, our cost base is
sensitive to rand weakness as well as
higher commodity prices whilst the cost
of mitigating the regular occurrence of
loadshedding is significant. This will
require ongoing agility and judicious
price/volume management in the face
of a challenged consumer.
To this end, the progress made over the
last three years in terms of stabilising
the core and building a solid foundation
for growth will help facilitate the agility
required. Significant investments were
made in technology and digital
capabilities, which will help drive
operational efficiencies, increase
automation, improve data analytics,
and drive revenue management
initiatives. In addition, there are further
cost-saving opportunities that are
While the performance this year is
encouraging and provides forward
momentum as well as internal
confidence, there is still much work
to be done to deliver the group’s full
potential. We are confident in our
strategies and our focus for the
foreseeable future remains on relentless
and flawless execution.
Appreciation
Albeit a challenging year, we have
made meaningful progress on many
initiatives that will benefit the group
going forward. I wish to thank Noel,
and my colleagues on the executive
committee, the audit committee and
the board, for their support and
guidance. I also wish to thank the
finance department for their dedication
and support. Finally, thank you to our
shareholders for their investment and
meaningful engagement.
Deepa Sita
Deepa Sita
Chief financial officer
1 December 2022
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur governanceOur businessOur performanceOverview
OPERATIONAL REVIEW
GRAINS
OVERVIEW
Revenue in Grains increased
by 6% to R15,5 billion,
reflecting average price
inflation of 9%, offset by
overall volume declines of 3%.
Operating income recorded a
marked recovery in the second
half driven by all segments
except Maize. Despite this, it
was not enough to offset the
poor first-half performance,
with the full-year operating
income ending 7% lower at
R1,3 billion.
Revenue in Milling & Baking
increased by 5% to
R10,6 billion, influenced by
price inflation of 16% and an
overall volume decline of 11%.
Bakeries benefited from the
planned volume recovery
initiatives in the second half,
driven primarily by top-end
retail, while the performance
in the general trade gained
encouraging momentum.
Despite an improved volume
performance in the second
half, this was not enough to
offset the poor start to the
year. In addition, price
increases and cost reduction
initiatives were insufficient to
counter the significant impact
of higher fuel costs and raw
material inflation. Maize’s
performance was adversely
impacted by continued volume
pressure as well as volatile raw
material prices. This was
compounded by the effect of
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FINANCIAL HIGHLIGHTS
Revenue
Operating income
Operating margin
Up 6%
R15,5bn
2021: R14,6 billion
Down 7%
R1,3bn
2021: R1,4 billion
8,2%
2021: 9,4%
higher conversion costs driven by
increased generator utilisation amid
excessive loadshedding and power
outages. The sorghum-based breakfast
and beverages business delivered a
muted performance, impacted by
supply challenges and lower demand.
Overall, Milling & Baking’s total
operating income declined by 21%
to R803 million.
Revenue in Other Grains grew by 9%
to R4,9 billion and operating income
increased by 33% to R469 million,
largely as a result of Rice’s significantly
improved performance. Although the
Oat-based breakfast (Jungle) and
Pasta businesses delivered solid
revenue growth, higher raw material
and distribution costs, as well as
sub-optimal factory performances,
adversely impacted profitability.
Volumes in Rice benefited from
category deflation relative to other
carbohydrates as well as successful
brand and customer initiatives.
LOOKING AHEAD
Focus on supporting innovations
in wheat category
Continued focus on volume/value in
bread to remain agile
Continued focus on cost savings
and efficiencies
Various customer and shopper
campaigns in the pipeline
to drive volume growth
Continued investment in pasta plant
to improve quality and build equity
Improve product mix and availability
of pasta and Jungle RTE ranges
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OPERATIONAL REVIEW CONTINUED
CONSUMER BRANDS*
OVERVIEW
Within Consumer Brands, all
segments delivered top-line
growth, with a particularly
strong performance from Out
of Home as the business
recovered in line with post
lockdown demand. Groceries
also recorded strong revenue
growth and benefited from
new product innovations.
Snacks & Treats produced a
strong second-half recovery
following supply challenges in
the first half due to labour
disruptions and low opening
stock levels. Overall, revenue
in Consumer Brands increased
by 12% to R12,4 billion.
Operating income increased
by 25% to R1,4 billion,
attributed primarily to strong
second-half recoveries in
Snacks & Treats, as well
as sustained strong
performances in Groceries,
Beverages and Out of Home.
Baby recorded a marginal
improvement in operating
income.
Groceries delivered a strong
top-line performance, growing
revenue by 15% to R6,4 billion,
driven primarily by price
inflation of 11%, while total
volumes increased by 4%.
Despite significantly higher
selling prices, volumes
benefited from innovation and
support from top-end retailers,
as well as growth in the
wholesale channel. Core
offerings benefited from
cost-competitive value packs
and price-pack solutions for
value-seeking consumers,
* Excludes the impact of product recalls.
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FINANCIAL HIGHLIGHTS
Revenue
Operating income
Operating margin
Up 12%
R12,4bn
2021: R11,1 million
Up 25%
R1,4bn
2021: R1,1 billion
11,1%
2021: 10,2%
resulting in market share gains across
most segments. Volumes were further
supported by distribution gains on
product innovations such as canned
fish. The improved top line, together
with ongoing efficiency improvements,
logistics savings, optimal promotional
activity and revenue management
benefits, resulted in operating income
increasing by 51% to R597 million.
Revenue at Snacks & Treats
increased by 4% to R2,4 billion,
supported by price inflation of 8% less
an overall volume decline of 4%.
Revenue in the second half increased
by 24% following industrial action in the
first quarter of the financial year which
adversely impacted sales and inventory
levels going into the peak Easter
season. A particularly strong
performance was delivered in the
second half across the portfolio with
distribution gains in the general trade
supporting recovery. Operating income
increased by 12% to R263 million due
to a favourable product mix, while the
factory benefited from increased
throughput as inventory levels were
restored in the second half.
Beverages’ revenue increased by
11% to R1,8 billion, supported by
volume growth of 5% and price inflation
of 6%. Volume growth was driven by
concentrates in the first half of the year
as a result of price pack innovation in
Oros, a strong performance from
sports drinks (Energade) and improved
distribution of the full ready-to-drink
flavour range. Despite a meaningful
recovery in second half profitability
relative to last year, operating income
for the full year increased marginally to
R269 million, mostly due to the impact
of higher raw material costs and
packaging inflation.
Revenue growth of 4% to R1,1 billion in
the Baby segment was driven by price
inflation of 11%, offset by volume
declines of 7%. Volumes are reflective
of lower demand across the jar and
pouch segments within the nutrition
portfolio, particularly in the second half
of the year. Operating income increased
by 3% to R147 million, with the benefit
of improved factory efficiencies being
partially offset by an unfavourable
product mix. Once-off costs related to
the precautionary recall of certain
baby powder products amounted to
R16 million, and largely comprise the
cost of the affected stock that has been
written off, as well as the logistics costs
of the recall.
LOOKING AHEAD
Groceries
– Partner with procurement and logistics to
deliver further savings
– Further manufacturing platform efficiencies
– Fast-track innovation and value
proposition focus
– Execution of new peanut butter site
Beverages
– Optimisation of operating model to reflect seasonal
nature of business
– Drive innovation execution
– Cold availability rollout
– Focus on combo deals throughout winter to mitigate
volume regression
– Relentless focus on efficiencies and continuous
improvement to mitigate cost push
Snack & Treats
– Fixing and optimising the supply chain remains a priority
– Revenue management to improve promotional ROI
and inform strategic pricing relative to consumer
need state and relative product positioning
– Drive innovation via strategic partnerships
Baby
– Continued brand investment
– Optimal revenue and portfolio management to hold
share in nutrition
– Relentless focus on cost management to remain
competitive on shelf
– Innovation will continue to focus on functional
and taste benefits
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur governanceOur businessOur performanceOverview Overview
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OPERATIONAL REVIEW CONTINUED
HOME AND PERSONAL CARE (HPC)
EXPORTS AND INTERNATIONAL
OVERVIEW
Overall revenue in HPC
declined by 5% to R1,9 billion,
primarily due to lower volumes
in the pesticides segment
within Home Care. This,
together with a significant
cost-push, resulted in
operating income declining
by 29% to R308 million.
Personal Care’s revenue
increased by 4% to
R672 million as a result of
price inflation of 12%, offset
by volume declines of 8%.
Despite improved profitability
in the second half, significant
increases in ingredients and
packaging costs, as well as an
adverse product mix, resulted
in operating income declining
by 66% to R16 million.
Home Care was unable to
recover from a poor start to
the year as unfavourable
weather conditions impacted
category demand for
pesticides. Revenue declined
by 9% to R1,2 billion, due to
17% lower volumes, offset by
price inflation of 8%. Lower
volumes, together with higher
raw material and packaging
costs, resulted in operating
income declining by 24% to
R292 million.
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Campho r
FINANCIAL HIGHLIGHTS
Revenue
Operating income
Operating margin
Down 5%
R1,9bn
2021: 2,0 billion
Down 29%
R308m
2021: 433 million
16,6%
2021: 22,2%
LOOKING AHEAD
Price management
to protect margin
Continued focus on
factory efficiencies
Execution of key capex projects:
warehouse upgrade and aerosol
replacement project
Successfully deliver innovation
focusing on functional benefits
OVERVIEW
Total revenue for Exports and
International increased by
19% to R4,3 billion, with total
operating income increasing
to R350 million (2021:
R96 million). This was primarily
driven by an improved
performance from the
Deciduous Fruit business,
which benefited from higher
international fruit prices and
improved volumes, resulting
in revenue increasing by 32%.
In addition, this business
recorded operating income of
R26 million, driven by higher
volumes and favourable
exchange rates due to the
weaker rand, compared to an
operating loss of R147 million
incurred in the prior year.
The Exports business grew
revenue by 14% following
improved sales of powdered
soft drinks and seasoning
into key export markets in
the second half. Operating
income increased significantly
to R143 million (2021:
R71 million) due to better
realisations, increased factory
efficiencies, improved stock
management and a favourable
product mix.
Chococam’s revenue
increased by 10% to
R1,1 billion (14% in local
currency), comprising 7%
volume growth and 7% price
inflation, reduced by an
unfavourable foreign currency
translation movement of 4%.
Volumes were driven by the
implementation of optimal
pricing strategies and
packaging solutions, an
improved distribution network
in key markets and market
share gains in chocolate.
Operating income in rand
terms increased by 5% to
R181 million.
FINANCIAL HIGHLIGHTS
Revenue
Operating income
Operating margin
Up 19%
R4,3bn
2021: R3,6 billion
Up 265%
R350m
2021: R96 million
8,2%
2021: 2,7%
LOOKING AHEAD
LOOKING AHEAD
Business stabilised
Newly appointed executive
to drive growth agenda
Re-opened sale process
for Deciduous Fruit while
reviewing all options
for sustainability
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur governanceOur businessOur performanceOverview PROTECTING VALUE THROUGH
GOOD GOVERNANCE
INDEPENDENCE
Independence
BOARD DEMOGRAPHICS
Age
Gender
Nationality
BOARD TENURE
Tenure
10
Independent
non-executive
directors
2
Executive
3
3
6
7
5
8
4
3
7
3
2
40 – 49 years
50 – 59 years
60 – 69 years
Women
Men
Black
White
Non-South African
0 – 3 years
3 – 6 years
6 – 8 years
Board composition
The board comprises 12 directors,
most of whom are non-executive
directors. Appointments to the board
are conducted through a formal and
transparent process supported by the
nomination and governance committee
in line with the policy on appointment
to the board of directors and board
diversity requirements in terms of the
group diversity policy.
In 2022, the board was further
strengthened by the appointment
of Frank Braeken on 1 April and
Lucia Swartz on 1 June.
Maya Makanjee and Mark Bowman
retired from the board on 31 December
2021 and 16 February 2022 respectively,
after serving on the board for more
than nine years.
Separation of powers
The board is led by the independent
chairman, Geraldine Fraser-Moleketi,
whose role and functions are clearly
defined and separate from that of
the CEO, Noel Doyle. The board
charter sets out a clear division of
responsibilities and authority at board
level, providing that no individual
director has unfettered powers
of decision making or influence
over the board, which allows for
participative decisions.
Board independence
The board assessed the independence
of the non-executive directors against
the criteria set out in King IVTM as well
as the provisions of the JSE Listings
Requirements and considered them
to be independent.
Board induction
New directors to the board undergo an
induction programme. The programme
comprises a briefing on essential board
and company information, including
governance structures; laws and
regulations affecting the business, as
well as business performance. This is
supplemented with visits to our
manufacturing sites.
Sessions are scheduled with board
and committees’ chairs, key executives
and the company secretary.
Board and committee
evaluations
This year, we commissioned an
independent external effectiveness
review that assessed the board’s
overall performance in 2022.
The board is effective in leading the
current business and has opportunities
to shift towards a more future-focused
approach. This includes having greater
exposure to the second level of
management, enabling improved
succession planning. Improvement
plans are being developed to close
identified gaps.
Board committees’ composition
and responsibilities
The board has delegated certain of
its functions to committees to assist
it in meeting its oversight responsibilities
in line with the board charter. The board
charter and board committee terms of
reference are reviewed annually to
ensure they remain relevant and aligned
with the requirements of King IVTM, the
Companies Act and governance best
practice.
The chairs of board committees
provide feedback to the board on the
key deliberations and decisions taken
by the committees.
During the year under review
each committee executed its
key responsibilities and the board
is satisfied that the committees
functioned in line with their respective
terms of reference.
www.tigerbrands.com
BOARD FOCUS AREAS IN 2022
Quarter 1
Quarter 2
Approved revised group delegation
of authority
Approved the execution of the share
buy programme
Approved appointment of external
auditors Deloitte & Touche
Approved the group’s financial results for
the year ended 30 September 2021
Approved the company’s suite of
reporting publications
Considered and agreed the directors
to be put forward for re-election and
appointment to the audit committee
at the AGM
Reviewed ESG matters, and climate
change approach and sustainability
reporting
Considered Rest of Africa strategy
and operating model
Considered the succession planning
and approved the appointment of new
directors
Considered updates on corporate
aspects such as the status of significant
strategic actions underway, key risk
matters, as well as the competitor and
shareholder landscape
Quarter 3
Quarter 4
Considered regular updates on the
group’s performance, strategic priorities,
interim financial results and forecasts
Approved the group’s financial results for
the six months ending 31 March 2022
Approved the group’s budget for the
2023 financial year
Reviewed and approved the group’s
strategy, in line with the company’s
strategic pillars
Considered the future of the Deciduous
Fruit business in the context of its
business model, portfolio fit and returns
Considered the macro-economic and
operating environments in relation to Tiger
Brands’ performance and prospects
Considered the capital expenditure
requirements for the culinary business
Considered Snacks & Treats portfolio,
including the chocolate turnaround
strategy and innovation initiatives
Received training on JSE-related
continuing obligations and disclosure
requirements
Reviewed the bakery business priorities
and progress achieved in respect of each
priority
Considered the benchmarking exercise
on product safety and quality, including
improvement opportunities, process
capabilities and operational opportunities
Attended a site visit at beverages plant
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance
PROTECTING VALUE THROUGH GOOD GOVERNANCE CONTINUED
SOCIAL, ETHICS AND
TRANSFORMATION
COMMITTEE
Members
TE Mashilwane1
(chairman)
MO Ajukwu2
NP Doyle
GA Klintworth
M Makanjee3
M Sello
Attendance
at meetings
3/3
1/1
3/3
3/3
1/1
3/3
1 Appointed as chairman
2 January 2022.
2 Appointed as member
1 April 2022.
3 Resigned as member and
chairman 31 December 2021.
RISK AND
SUSTAINABILITY
COMMITTEE
Members
M Sello (chairman)
MO Ajukwu
FNJ Braeken1
CH Fernandez
GA Klintworth1
GJ Fraser-Moleketi
OM Weber
Attendance
at meetings
3/3
3/3
2/2
3/3
2/2
3/3
3/3
1 Appointed as member
1 April 2022.
Mandate
Key focus areas in 2022
The committee fulfils the statutory duties as
set out in Regulation 43 of the Companies
Act, has oversight of and report on
organisational ethics, responsible corporate
citizenship, sustainable development and
stakeholder relationships, and assists the
board in facilitating and supporting the
development of transformation objectives,
ensuring that the corporate culture is
supportive of the approach and monitoring
and reporting actual performance against
these objectives.
As part of embedding an ethical culture,
monitored the implementation of the new
electronic declaration system
Monitored the ESG agenda, including
ESG performance and reporting
Monitored progress towards enhancing the
company’s culture including embedding the
approved diversity and inclusion strategy
Approved the ethics investigation framework
Accelerated the development of diverse
talent succession pipeline
Considered and supported socio-economic
development initiatives aimed at uplifting
the livelihoods of communities where
Tiger Brands operates
Monitored implementation of improvement
plans in respect of skills development,
employment equity and preferential
procurement
Monitored stakeholder engagement activities
Mandate
Key focus areas in 2022
The committee assists the board in its
oversight of the management of risk and
risk governance in the group.
Evaluated and monitored key risks and the
overall business risk profile and response
plan to address the risks appropriately
Ensured maturity and effectiveness of
enterprise risk management processes and
continuously monitored the implementation
of the risk management plan
Considered the combined assurance plan
and reviewed its implementation
Monitored the ESG agenda, including
sustainability performance
Considered the IT governance framework,
including cyber security and data architecture
Monitored the business insurance profile and
insurance claims underway
Monitored the safety, security, health and
environment activities of the group
Monitored the quality performance and the
maturity of quality management systems
www.tigerbrands.com
AUDIT
COMMITTEE
Members
CH Fernandez
(chairman)
FNJ Braeken1
M Sello
DG Wilson
Attendance
at meetings
3/3
1/1
3/3
3/3
1 Appointed as member
1 April 2022.
NOMINATION
AND GOVERNANCE
COMMITTEE
Members
GJ Fraser-Moleketi
(chairman)
MJ Bowman1
M Makanjee2
TE Mashilwane3
LA Swartz4
OM Weber3
DG Wilson
Attendance
at meetings
7/7
2/2
1/1
2/2
0/0
2/2
7/7
1 Resigned as member
16 February 2022.
2 Resigned as member
31 December 2021.
3 Appointed as member
1 April 2022.
4 Appointed as member
1 September 2022.
Mandate
Key focus areas in 2022
The committee primarily oversees the
integrity of the company’s financial reporting,
monitors the strength of internal financial
controls and ensures the effectiveness of
assurance services and functions, with
particular focus on combined assurance
arrangements, including external assurance
service providers, the finance function
and internal audit.
Considered the appointment of external
auditors and monitored the transition for
the rotation of external audit firms
Continuously evaluated the internal financial
reporting controls
Considered group tax matters
Considered the accounting treatment
of significant matters in the group
Evaluated the integrity and effectiveness
of the financial and non-financial reporting
Considered the group’s impairment
assessments
Reviewed the going concern assumptions,
solvency and liquidity testing and the
proposed dividend consideration
Assessed the suitability of the finance function,
internal auditors and external auditors
IT resilience and cyber security
Mandate
Key focus areas in 2022
The committee assists the board in
ensuring performance of the board, its
committees and directors. It reviews the
composition of the board and its committees
and recommends suitable candidates to fill
vacancies on these governance structures,
ensures the implementation of Tiger Brands’
succession plans, and reviews continuous
development programmes for directors.
Evaluated the board composition
to ensure it appropriately reflects the
required skills set and diversity
Recommended the commission of
external board effectiveness assessment
Monitored the implementation of the group
strategy in terms of succession plans and
talent pipelines for the board, executive
management and other critical skills
Managed the nomination process
of candidates for consideration for
appointment to the board
Monitored the assessment of the
performance of retiring directors due
for rotation in terms of the memorandum
of incorporation
Monitored progress of board diversity
targets and was instrumental in achieving
58% and 60% of female and black
representation respectively, against
a target of 50% on both elements
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance PROTECTING VALUE THROUGH GOOD GOVERNANCE CONTINUED
www.tigerbrands.com
Mandate
Key focus areas in 2022
The committee assists the board in
ensuring Tiger Brands’ remuneration
policies and practices are aligned to the
company’s objectives for value creation
and are benchmarked to ensure fairness
and competitiveness in remuneration of
employees to attract and retain key talent
and critical skills required to deliver
business goals and results.
Approved retention awards for Exco
members, excluding the CEO
Evaluated the remuneration strategies,
including policy and practices designed to
attract, motivate and retain talent, to ensure
they are linked to the company’s strategy
and value creation objectives
Approved the 2022 group STI scorecard
Reviewed and approved the targets relevant
to the STI scheme and the LTIP in line with
the relevant scheme rules
Conducted benchmarking process and
proposed the annual fees for non-executive
directors
Considered the annual performance
outcomes of senior management and
executives and conducted salary reviews
and monitored wage negotiation processes
Engaged with key shareholders on various
elements related to remuneration
Mandate
Key focus areas in 2022
This is an ad hoc committee which assists the
board in assessing investment opportunities
and divestments in line with the group’s
strategic objectives.
Assessed the investment opportunities in
line with the group’s strategic objectives
Considered and recommended the
share buy-back programme to the board
for approval, in line with shareholders’
approval
REMUNERATION
COMMITTEE
Members
DG Wilson
(chairman)1
MJ Bowman2
GJ Fraser-Moleketi
M Makanjee3
TE Mashilwane4
LA Swartz5
OM Weber4
Attendance
at meetings
6/6
4/4
6/6
3/3
2/2
0/0
2/2
1 1 Appointed as chairman
17 February 2022.
2 Resigned as member and
chairman 16 February 2022.
3 Resigned as member
31 December 2021.
4 Appointed as member
1 April 2022.
5 Appointed as member
1 September 2022.
INVESTMENT
COMMITTEE
Members
GJ Fraser-Moleketi
(chairman)
MJ Bowman1
CH Fernandez2
FNJ Braeken3
TE Mashilwane
OM Weber
DG Wilson
Attendance
at meetings
5/5
1/1
4/4
0/0
5/5
5/5
5/5
1 Resigned as member
16 February 2022.
2 Appointed as member
1 April 2022.
3 Appointed as member
2 December 2022.
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance REMUNERATION
AND PERFORMANCE
SECTION 1: BACKGROUND
STATEMENT
Statement from the chairman
of the remuneration committee
Dear stakeholder
On behalf of the remuneration committee
(the committee), I am pleased to present
the 2022 remuneration report which, in
compliance with best practice reporting
as recommended by the King IV™*
Report on Corporate Governance for
South Africa (King IV™), highlights:
› Key components of our remuneration
policy
› Alignment of our remuneration policy
with Tiger Brands’ business strategy
and priorities
› Implementation of the policy for the
year ended 30 September 2022
(FY22).
This year, the Tiger Brands executive
leadership team has effectively led the
execution of our six strategic priorities
to improve business performance,
and drive growth and innovation while
proactively navigating prevailing market
conditions.
Our remuneration outcomes
In line with our people strategy,
enhancements were made to the
remuneration strategy, including
ensuring further alignment of critical
business key performance indicators
(KPIs) to measure and reward
performance against our strategy.
The remuneration committee approved
the implementation of a revised short-
term incentive (STI) scorecard that
drives the achievement of KPIs, while
maintaining a healthy balance between
financial, strategic and sustainability
outcomes.
As a result of historically high turnover
of executive committee members,
many years of no STI payments, and
limited long-term incentive plan (LTIP)
vesting, the retention risk of executive
committee members had increased,
presenting a knock-on effect to the
stability of the CEO’s strategic and
operational support team. To this end,
there was a business need to provide
executive committee members with a
value proposition to continue driving
the turnaround strategy, especially
since there are signs of traction and
improved momentum. Motivated by
the CEO, the remuneration committee
has thus approved retention awards
for executive committee members,
(excluding the CEO). This was a
once-off award intended to retain
executives, rather than reward
performance, and is deemed to
be in the long-term interest of the
company. The awards are in line with
the company’s retention policy; the
various forms are explained in detail on
page 80 of the implementation report.
Looking ahead, the remuneration
committee approved the inclusion
of certain ESG metrics in the FY23
STI scorecard in line with Tiger
Brands’ sustainable future strategy
and associated targets (see further
details on
page 75).
Shareholder voting outcomes
The remuneration committee maintains
strong relationships with stakeholders
and strives towards high standards of
disclosure to ensure that there is a clear
understanding of our remuneration
policy and practices.
The non-binding advisory votes
by shareholders over the last
three years are summarised
below
% vote
in favour
Remuneration
policy
Remuneration
implementation
February February February
2022
2021
2020
91,55% 89,20% 76,55%
96,94% 82,24% 78,71%
Shareholder engagement
The remuneration committee is
committed to shareholder engagement
and will take the following steps if 25%
or more of total votes exercised by
shareholders at the upcoming AGM
are against the remuneration policy
or implementation report:
› Tiger Brands will issue a SENS
announcement requesting
shareholders to appropriately engage
on their specific concerns and will
seek to actively engage with
dissenting shareholders by inviting
them to one-on-one meetings, where
necessary
› Tiger Brands will consider
shareholder concerns and report on
the outcome of the engagements and
measures taken, in its next integrated
report.
While the voting outcomes on the
remuneration policy and the
implementation report have been
positive over the last three years, the
remuneration committee chairman,
the chief human resources officer
(CHRO) and investor relations
proactively conducted a series of
engagements with key shareholders
on the following matters:
1. Retention awards to executive
committee members, excluding
the CEO granted in FY22
* Copyright and trademarks are owned by the Institute of Directors in South Africa NPC and all of its rights are reserved.
70
70
www.tigerbrands.com
while EY provide services to assist
with the review of the single total figure
page 83. The
of remuneration table on
committee is satisfied that PwC South
Africa, KPMG and EY are independent
and remained objective in providing
these services.
Voting at the Annual General
Meeting (AGM)
As required by King IVTM, the
remuneration policy and
implementation report that follow, will
be tabled for separate non-binding
advisory votes by shareholders at the
upcoming AGM in February 2023. As
required by the Companies Act,
non-executive directors’ fees for the
coming year will be put to shareholders
by way of a special resolution.
Achievement of policy
objectives
On behalf of the committee, I am
satisfied that the remuneration policy
is appropriate, and I am confident that
our remuneration policy has achieved
the desired outcomes for FY22 and is
aligned with the company’s strategic
goals. The remuneration disclosures
presented in this report have been
made in compliance with the
remuneration policy as approved by
shareholders. No known deviations
from the remuneration policy have been
made in the current financial year, other
than the retention awards made to the
executive committee, excluding the
CEO.
Donald Wilson
Chairman – Remuneration committee
1 December 2022
71
› Benchmarking the total reward of the
CEO and CFO against a comparator
group of JSE-listed companies
› Benchmarking total reward of the
executive directors and senior
management against market data
obtained from the REMchannel
remuneration survey
› Benchmarking NED fees against
a comparator group of JSE listed
companies
› Incentivising performance more
tangibly through the STI and sales
incentive schemes. The sales incentive
scheme was implemented in FY22
and targeted at sales representatives
and regional customer operations
managers. The objective is to drive
an increase in sales
› Continuously address identified pay
inequities during the annual salary
review process by allocating a
separate income disparity budget
to address the inequities
› Continuing to review our reward
mechanisms and practices with a
view to introducing innovative reward
strategies to:
» Drive winning performance
» Attract, retain, and motivate key
and critical talent, core, and
leadership capabilities
» Embed the recognition platform
and practices that improve the way
we recognise execution excellence,
agility and consumer-obsession.
External advice provided to the
committee in FY22
In reviewing our remuneration offering
to ensure that it is competitive, fair,
transparent, and responsible, we
enlisted the services of PwC South
Africa to assist us with benchmarks
relating to remuneration of executive
directors and non-executive directors,
incentive scheme market practice,
remuneration trends and survey data.
KPMG are engaged annually for the
purpose of auditing STI payments,
2. Best practice in terms of
incorporating ESG metrics into
executive reward
3. Best practice with regards to
minimum shareholding requirements
4. Best practice in terms of LTIP
performance conditions, targets
and structure
5. General disclosure.
Key focus areas, objectives,
and activities for FY22
In FY22 the committee undertook the
following activities:
› Reviewed the peer comparator group
for the purposes of non-executive
director and executive remuneration
benchmarking
› Benchmarked the appropriateness
of the LTIP performance conditions,
targets and structure
› Approved the wage negotiation
mandate for bargaining unit
employees
› Approved the salary increase
mandate for employees on total
remuneration packages (TRP)
› Approved the remuneration for
executive directors and executive
committee members
› Approved the STI and LTIP
performance conditions, targets,
and weightings in respect of FY23
› Embedded the STI integrated
scorecard and LTIP scheme to align
behaviours with business objectives,
shareholder interests and drive
winning performance
› Recommended for approval to the
board non-executive directors’
(NEDs) fee increases
› Approved the implementation of
measures to address identified
historical pay disparities.
Focus areas for FY23
› Embedding the STI integrated
scorecard and LTIP scheme to align
behaviours with business objectives,
shareholder interests and drive
winning performance
Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance
REMUNERATION AND PERFORMANCE CONTINUED
SECTION 2: OVERVIEW OF
REMUNERATION POLICY
The terms of reference are reviewed
annually.
Remuneration governance
The membership of the Tiger Brands
remuneration committee consists of
a minimum of three non-executive
directors, the majority of whom are
independent. The CEO is a permanent
invitee to all meetings and other executives
may attend the meetings by invitation.
The CEO and nominated invitees are
not present when matters relating to
their own remuneration are discussed.
The group company secretary is the
secretary of the committee.
The committee meets four times a
year and, where necessary, additional
meetings may be held.
As documented in the remuneration
committee terms of reference the duties
and responsibilities of the committee are:
› Remuneration governance
› Executive and senior management
remuneration and performance
› Non-executive director remuneration.
Fair and responsible
remuneration
Tiger Brands is committed to a total
reward offering built on a strong
foundation of fair and responsible pay
that is linked to our remuneration
philosophy of pay-for-performance.
Salaries are benchmarked annually
against the REMchannel salary survey
to ensure that people are remunerated
fairly and in line with market practices.
We follow a job grading methodology
that is consistent and provides a fair
and accurate job grade, which allows
for proper salary benchmarking.
We also use a pay progression model
to fairly reward employees based on
performance and market positioning
that enables the management of
employees who are significantly below
and above market rates.
Pay inequities are assessed and adjusted
during the annual reward review process.
Employees whose annual TRP are
below the minimum pay scale are
assessed and salaries adjusted in line
with the income disparity mandate. This
salary adjustment is generally capped
at a predetermined percentage to limit
exorbitant increases. Specific focus is
given to ACI, female and employees in
roles that require scarce and critical
skills.
Tiger Brands’ remuneration
strategy
The remuneration strategy is aligned
with the Tiger Brands’ people strategy,
which is geared to enable the execution
of the business strategy and accelerate
business performance.
Our remuneration principles have been
designed to support the execution of
the people strategy and are premised
on our belief that great people and
great brands are at the core of our
success. Our reward framework is
holistic, encompassing the financial
elements of reward, as well as non-
financial aspects such as recognition,
development, the work environment,
culture and challenging work.
REWARD FRAMEWORK
BUSINESS STRATEGY
DEVELOP
TALENT
INSPIRE WINNING
PERFORMANCE
EMPLOYEE VALUE
PROPOSITION
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GREAT PEOPLE
DELIVERING
WINNING
PERFORMANCE
People strategy
www.tigerbrands.com
Our remuneration policy has the
following key objectives:
› Strengthen our ability to competitively
attract and retain talent to enable the
execution of our strategy
› Align Tiger Brands’ annual and
long-term performance to the delivery
of the strategy
› Align Tiger Brands’ reward structures
with shareholder interests
› Implementation of minimum
shareholding requirements
› Motivate and stimulate high
performance across Tiger Brands
through competitive short and
long-term incentives
› Ensure fair and responsible pay
› Ensure that reward mechanisms are
simple and provide line of sight to
all employees.
We have summarised below the various remuneration elements (guaranteed
package, short-term incentive and long-term incentive) that Tiger Brands offers at
different levels of employment (excluding bargaining unit employees):
TRP employees
Anchor point
Benefits
All inclusive salary package plus annual STI based on performance.
LTIP applicable to grades D and above.
Tiger Brands has anchored its current fixed pay position at the 65th
percentile of the national market. We aspire to achieve a normal
distribution around the anchor point based on individual performance,
talent/potential, experience and in certain instances, tenure. It is
important to note that guaranteed packages are not automatically
adjusted to the anchor point. The performance-based increases granted
in the organisation (including those for executive directors and executive
committee members) are managed within the overall salary increase
budget and the pay progression model as discussed below.
Benefits include retirement fund contributions, funeral cover, permanent
health insurance, death-in-service cover, medical aid contributions and
travel allowances (where applicable).
Guaranteed package (excluding
bargaining unit employees)
Description
Guaranteed package (GP) offered to
people on a total remuneration package
basis (TRP) comprises base pay,
allowances, retirement and medical
benefits. It is reviewed annually based
on personal performance (KPIs linked
to individual performance agreements
(IPA) for each TRP employee which is
agreed to at the commencement of
every year), business performance
(linked to budget), behaviours aligned
with company values and market
competitiveness (national and sector
benchmarks).
Benchmarks
Benchmarking for executive directors
and non-executive directors is based
on a comparator group of companies
and is reviewed on a bi-annual basis.
The comparator group is determined
using the closeness metric formula.
This closeness metric is constructed
to measure how similar a candidate
company is to the company and is
based on:
› Total assets
› Turnover
› Earnings before interest, tax,
depreciation and amortisation
(EBITDA).
The comparator group for 2022 has
changed from 2021 to include more
manufacturing and food companies,
which are more relevant to our industry.
Companies included in the 2022 comparator group comprise:
Factor
Survey type
Comparator group*
Executive directors
Bespoke survey
Public data of South African companies listed on the JSE, based on the closeness metric
is used to determine an appropriate comparator group
The Foschini Group
AVI
Clicks Group
KAP Industrials Holdings
Dischem
Massmart Holdings
Mr Price Group
Pick n Pay Stores
RCL Foods
Oceana
Woolworths
Barloworld
Tongaat Hulett
Libstar
Rest of Exco, senior
management and below
REMchannel® survey
National and consumer goods
circles
* From FY20 the comparator group for executive directors and non-executive directors’ remuneration benchmarking has been merged.
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REMUNERATION AND PERFORMANCE CONTINUED
2021 comparator group:
Factor
Survey type
Comparator group*
Executive directors
Bespoke survey
Public data of South African companies listed on the JSE, based on the closeness metric
is used to determine an appropriate peer group
Rest of Exco, senior
management and below
REMchannel® survey
Aspen Pharmacare Ltd
AVI Ltd
Clicks Group Ltd
Distell Group Ltd
Imperial Holdings Ltd
Massmart Holdings Ltd
Mr Price Group Ltd
Pick n Pay Stores Ltd
RCL Foods Ltd
The Spar Group Ltd
Woolworths Holdings Ltd
National and consumer goods
circles
* From FY20 the comparator group for executive directors and non-executive directors’ remuneration benchmarking has been merged.
› The STI outcomes are determined
based on a multiple of the on-target
STI, which comprises three
performance factors, reflecting the
three dimensions of performance that
is expected from employees:
» A group performance factor
focused on group financial and
non-financial metrics
» A business unit performance factor
focused on business unit financial
and non-financial metrics
Calculation
» An individual performance factor
focused on individual performance
objectives and allows for
differentiation in rewarding high
performers.
Payment of an STI is subject to the
overriding condition that the group/
business unit meets or exceeds the
agreed entry threshold in respect of its
earnings before interest and tax (EBIT).
Short-term incentive
Description and link to strategy
The primary intention of the STI is to
improve business performance by
focusing participants’ attention on
annual key financial, strategic,
functional and personal performance
objectives (KPIs based on a balanced
scorecard), which are aligned with the
long-term business strategy for
sustainable value creation. This drives
high performance by explicitly creating
line of sight in linking group, business
unit and individual performance.
› All permanent employees on a
guaranteed package in Paterson
grades CU and above, are eligible to
participate
› The STI is paid annually in cash to
qualifying people who are employed
by the organisation on the payment
date
› The on-target percentage (as a
percentage of guaranteed package)
is benchmarked against the South
African market to ensure we are
aligned with market best practice.
The STI payment is based on
affordability and on achieving the
defined objectives
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Pre-determined weightings will be applied to each of the performance factors. In respect of the individual performance factor,
participants will be rated on a rating scale ranging from 1 (poor performer) to 5 (exceptional performer). The remuneration
committee has final discretion over the approval of STI payments.
Target and maximum
In FY23 the following ranges of STI awards will apply to the various categories of people covered by this report:
CEO, CFO, and executive directors
Executive committee members
Other participants (Paterson grades CU to E band)
On-target
percentage
of guaranteed
package
60
60
8,5 to 50
Maximum
of on-target
percentage
200
200
200
Group and business unit performance factors
The underlying values and weightings for each KPI are set and approved by the remuneration committee in advance of each
year to determine parameters for the STI in the form of a balanced scorecard. Below is the group STI scorecard for FY23 that
will be applied to the CEO, CFO, executive directors, executive committee members and other participants:
Strategic
objective
Growth1, 2
Strategic
objective
Key performance
weighting
indicator
57,5% Sales volume growth
Brand health
FY23 Innovation NS
delivery
FY24 to FY26 Innovation
pipeline value
EBIT
Overall equipment
effectiveness
(factor in waste)
Key
performance
indicator
weighting
5%
7,5%
5%
40%
Threshold
score = 50%
92%
On-target
score = 100%
100%
Stretch
score = 200%
150%
96%
90%
93%
96%
100%
100%
100%
100%
104%
120%
114%
107%
5% Improvement in overall equipment effectiveness year-on-year
5%
10%
78%
100%
Continuous Improvement (Rm)
89%
100%
Reduction in complaints year-on-year
86%
100%
10%
Reduction in lost time injuries year-on-year
5%
7,5%
105%
67%
67%
122%
89%
100%
100%
100%
100%
100%
144%
122%
129%
88%
150%
150%
78%
111%
1 The actual targets have not been provided as they are linked to budget and considered commercially sensitive information.
2 For each of the key performance indicators within growth and efficiency, the targeted percentages for “threshold”, “on-target” and “stretch” represent
the targeted percentage achievement of the underlying budgeted amounts.
The group, business unit and individual performance weightings applicable to the various employee categories are detailed below:
Employee category
CEO, CFO and executive directors
Executive committee members
Other participants (Paterson grades CU to E band)
Group
80%
80%
Business unit
0%
0%
0% to 40%
40% to 80%
Individual
20%
20%
20%
75
Group performance factor
(0 to 200%)
Efficiency1, 2
10%
STI
Annual
TRP (GP)
On target
%
Business unit performance factor
(0 to 200%)
People and
sustainability1
32,5%
Quality
Individual performance
(0 to 200%)
EBIT THRESHOLD GATEKEEPER
Safety (LTIFR)
Carbon emissions
Talent pipeline
Time to fill
Vacancy fill
Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance REMUNERATION AND PERFORMANCE CONTINUED
Long-term incentive plan
Description
The LTIP is aligned to our reward approach and operating model, taking into consideration the following principles:
› Strengthen our ability to competitively attract and retain talent to enable the execution of our business strategy
› Align Tiger Brands’ leadership performance to our long-term strategy and, in particular, to unleashing the power of our
people objective.
Employees in Paterson grade D and above may be eligible to participate in the annual awards of the LTIP.
The table below provides further details regarding the performance shares (conditional rights to shares) and restricted shares
(conditional rights) awarded under the LTIP:
Instrument
Performance shares
Restricted shares
Award mechanism
Frequency of awards
Performance multiplier
Calculation of
award quantum
Vesting
Performance
conditions applicable to
performance shares
Performance
shares multiple
Employee category
CEO
CFO
Executive committee members
Senior management and below
› Awards are generally made once a year in December
81,3% CEO
81,3% CFO
61,0% Executive committee members
10,6% – 27,7% Senior management and below
Restricted
shares multiple
–
–
–
8,2% – 22,9%
› Awards are generally made once a year in December
Employee category
as part of the annual review process
as part of the annual review process
› A personal performance multiplier is used to modify the
standard quantum of performance shares and restricted
shares, based on an individual’s personal sustained
performance and potential
› This is based on a 9-box matrix taking performance
over the last three years into account and a percentage
ranging from 0% to 150% is applied on award
› (GP x performance share multiple/share price) x
› A personal performance multiplier is used to modify the
standard quantum of performance shares and restricted
shares, based on an individual’s personal sustained
performance and potential
› This is based on a 9-box matrix taking performance
over the last three years into account and a percentage
ranging from 0% to 150% is applied on award
› (GP x restricted share multiple/share price) x
performance multiplier
performance multiplier
› Three-year vesting based on anniversary of award
› Three-year time-based vesting based on anniversary
and achievement of performance conditions
of grant
HEPS growth (weighted at 50%):
› 0 – less than CPI + GDP
› 25% vesting (threshold) – CPI + GDP
› 100% vesting – CPI + GDP +2%
› 200% vesting (stretch) – CPI + GDP +4%
The HEPS calculation is performed on an annual compound
basis over the three-year vesting period.
Linear vesting to apply between threshold and stretch.
ROIC – (weighted at 50%):
› 0 – less than WACC +1%
› 25% vesting (threshold) – WACC +1%
› 100% vesting – WACC +2%
› 200% vesting (stretch) – WACC +5% and above
The measurement will be the average ROIC over the
three-year vesting period.
Linear vesting to apply between threshold and stretch.
Based on the volume-weighted average price (VWAP) for a
Tiger Brands share calculated for the 10-trading day period
ending immediately prior to the date of award/grant.
Based on the volume-weighted average price (VWAP) for a
Tiger Brands share calculated for the 10-trading day period
ending immediately prior to the date of award/grant.
Share price
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» The trust provides bursaries for
tertiary education to dependants
of permanently employed black
people who might not otherwise
be able to afford this cost.
Dilution
The maximum aggregate number
of shares that may be acquired by
participants under the LTIP scheme
and any other share plan may not
exceed 5,5 million shares, and for any
one participant 550 000 shares.
In determining these limits, shares
acquired through the JSE and
transferred to participants are not
considered. At 30 September 2022,
the aggregate number of shares that
may be acquired by participants under
the various schemes was 2 557 731
(2021: 2 634 230), which represents
approximately 1,4% of the number of
issued ordinary shares. This is in line
with JSE regulations.
Minimum shareholding policy
We have a minimum shareholding policy,
where senior executives are expected to
build up their personal shareholding in
the company over a specific period. In
the case of the CEO, the target is 200%
of guaranteed package while the target
for executive directors and members of
the executive committee is 100% of
guaranteed package. Senior executives
who were in service when the policy
was adopted in 2016 have six years to
build up their shareholding from date of
adoption. Senior executives appointed
after adoption have six years to build
their shareholding from date of
appointment. They may use any vesting
LTIs or their own resources to acquire
these shares.
Exemption from compliance with the
minimum shareholding requirements
In the case of the minimum shareholding
requirement not being met, the board
retains the overriding discretion to:
› Vary the minimum shareholding
level or extend the determination
date for an individual executive
or the executives as a whole.
This will only be allowed to apply
in exceptional circumstances
› Determine that an executive has
complied with the policy even if
the number of shares held by an
executive does not meet the minimum
shareholding requirements. Such an
exemption will only be allowed in
exceptional circumstances where
compliance will result in severe
financial difficulty for an executive or
prevent an executive from complying
with an order of a court of law.
Malus and clawback
With respect to malus, if the
remuneration committee, in consultation
with the board and/or any committee of
the board, believes that a trigger event
has occurred, it has full discretion to
reduce, in part or whole, unvested
variable remuneration (ie STIs and LTIs)
before the end of the vesting or payment
period. In the case of clawback, it is
the responsibility of the remuneration
committee, in consultation with
the board and/or any committee of
the board, to implement clawback for
the whole or portion of vested variable
remuneration in the event of a trigger
event occurring over a period of three
years from the date on which payment
was made of such vested variable
remuneration. Trigger events include,
but are not limited to:
› Material misstatement of financial
results
› Misconduct, incompetence, fraud,
dishonesty
› Negligence or material breach of
obligations to the company
› Deliberate harm to the company’s
reputation
› Material failure of risk management.
Illustrating potential
remuneration outcomes
The variable pay arrangements
described above have various potential
outcomes. These outcomes could be
from zero (minimum) to the expected
level of performance outcomes (target)
to the maximum potential variable pay
outcomes (capped at the maximum).
In the illustrations presented on the
following page, it should be noted that:
› STI represents the cash component
of short-term performance
› LTIP represents the total award of
performance vesting shares.
77
Historical LTIP information
The following LTIP instruments
were discontinued. However, eligible
employees still have exposure to
these instruments through previous
allocations, which include:
› Restricted shares issued as bonus-
matching shares (full value shares
with a three-year vesting period,
no performance criteria). The last
grant of bonus-matching shares was
made on 6 December 2018. These
shares have been settled in FY22.
› Share appreciations rights (SARs).
The last allocation of SARs was
made on 5 June 2019. The SARs
vest over a five-year period, subject
to the achievement of the applicable
vesting criteria, namely real HEPS
growth (50%) and ROIC (50%). The
performance measurement of the
last tranche of SARs will be
performed in FY24.
BEE shares
The following two schemes were
established as part of the company’s
black empowerment strategy:
› Tiger Brands Black Managers Trust
and retain diverse talent
(BMT I)
» Established in 2005 to attract
» Rights allocated – Tiger Brands
shares. Rights are settled after
making the required capital
contributions to BMT I. For all
rights allocated on or before
31 July 2010, settlement may take
place at any time after the initial
lock-in period, ie, from 1 January
2015. For all rights allocated after
31 July 2010, the lock-in date
varies depending on the date
of allocation. Periodically, new
allocations are made to new joiners
and top-up allocations are made
to existing participants promoted
to higher grades out of shares
that may become available as a
consequence of forfeitures
» The scheme made its final
allocation in August 2022
› Thusani Trust
» Established in 2005 as part of the
company’s BEE phase I
empowerment initiative. The trust’s
resources were enhanced in 2009
under the company’s BEE phase II
transaction
Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance REMUNERATION AND PERFORMANCE CONTINUED
Total remuneration potential for members of executive management for the year ended 30 September 2022
CEO (R’000)
Maximum
10 400
12 480
20 800
On-target
10 400
6 240
10 400
Minimum
10 400
GP
STI
LTI
CFO (R’000)
Maximum
6 600
7 920
13 200
On-target
6 600
3 960
6 600
Minimum
6 600
12
GP
STI
LTI
Members of executive committee (average) (R’000)
Maximum
5 152
6 182
7 730
On-target
5 152
3 091
3 865
Minimum
5 152
GP
STI
LTI
12
Executive service contracts
Senior executives are employed full-time under standard agreements, with a notice period of three months. We strive to bind all
senior executives by a restraint-of-trade agreement. To the extent that executives have access to proprietary business insights
and intellectual property, Tiger Brands will enforce the agreement should they join a competitor. The restraint comprises a
three-month notice period or three months’ special leave (paid as a three-month lump sum (based on guaranteed package)
on termination).
Sign-on and specific retention payments
In exceptional circumstances (mainly for the recruitment and retention of critical and/or scarce talent), Tiger Brands will award
a sign-on/retention payment which will be subject to the following conditions:
› Employees remaining in the service of Tiger Brands as a permanent employee for an uninterrupted period of 24 months from
date of the payment. Should the employee or Tiger Brands decide to terminate the employment relationship for any reason,
excluding those listed below, before the expiration of 24 months, the employee will be required to repay Tiger Brands the
full gross amount. There will be no pro rata refunds. Should Tiger Brands terminate the employment relationship because
of operational reasons (for example, retrenchment or redundancy) or ill health, or if termination occurs as a result of death,
the employee will not be required to repay Tiger Brands.
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Involuntary termination
(retrenchment, retirement, death)
Paid up to last day of service including notice period, where applicable.
Payments on termination of employment
Remuneration policy
component
Voluntary termination
(ie resignation)
Paid up to last day of
service
Guaranteed package
Medical aid
Benefit continues to last
day of service
Benefit continues up to last day of service. Employees who qualify for
post-retirement medical aid funding will continue to receive the
employer contribution with effect from their normal retirement date.
Retirement and risk
plans
Employer contributions paid until last day of service. Employee is entitled to the value of the
investment, but all risk benefits cease on termination of service.
Other benefits
Not applicable
Short-term incentives
No pro rata bonus paid
Long-term incentives
All unvested awards
Severance package in respect of retrenchments – one or two weeks for
every completed year of service in terms of the relevant rules.
Pro rata STI payment (based on extent of achieving specified financial
and strategic targets for the period and a personal performance
agreement being in place at the date of exit).
Depending on the nature of the instrument and reasons for termination,
a participant may retain all units or a pro rata portion. Accelerated
vesting and settlement of retained units may apply in certain
circumstances.
External board appointments
Under a formal policy, an executive is limited to one substantive outside directorship. The chairman of the Tiger Brands’ board,
chairman of the nominations committee, and chairman of the remuneration committee are required to authorise these appointments
based on a recommendation from the CEO. Other than in respect of their appointment to the boards of associate companies,
directors’ fees under this policy may be retained by the individual. Tiger Brands currently has one executive member serving as
non-executive director on the main board of a listed company.
Non-executive directors
Fees and approval process
Non-executive directors are paid an annual retainer that reflects their overall contribution and input to the company, and not
just for attendance at board and committee meetings. Fees are also paid on an hourly basis for approved, ad hoc meeting
attendance. Fees are reviewed annually, and increases are implemented in April after approval at the relevant AGM.
A benchmark analysis is conducted annually against an agreed comparator group of South African companies listed on the
JSE, based on market capitalisation, turnover and total assets. As these are similar metrics to that of the benchmark group
for executive directors it was decided that from FY20, in line with King IVTM and in terms of the current requirements of the
organisation, a single comparator group be adopted for the non-executive directors and executive directors’ remuneration
benchmarking. The revised comparator group is detailed on
page 73.
Targeted remuneration for the 12-month period ending 28 February 2023 was based on the 65th percentile of the comparator
group, which is aligned with our internal anchor point. Non-resident non-executive directors are paid a premium in comparison
to resident directors, which is below the market median. The chairman does not receive any additional remuneration for participating
in committees of the board. Non-executive directors who perform services outside the scope of their ordinary duties will not
receive additional remuneration. Shareholder approval will be sought for increasing non-executive directors’ fees, including fees
paid for attending special board meetings. Details of proposed non-executive directors’ fees effective from 1 April 2023 appear
in the notice of AGM of shareholders to be held on 21 February 2023. Details of non-executive directors’ fees paid in the review
period appear on
pages 86 and 87.
Voting statement
This remuneration policy is subject to a non-binding advisory vote by shareholders at the upcoming AGM.
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance 2022 guaranteed package
The following increases to guaranteed packages were implemented in the reporting period for executive directors. New amounts
were effective as indicated below:
People and
sustainability
25%
Quality
REMUNERATION AND PERFORMANCE CONTINUED
SECTION 3: IMPLEMENTATION REPORT
In this section of the remuneration report we explain the implementation of our remuneration policy, providing details of
the remuneration paid to our executive directors and members of the executive committee for the financial year ended
30 September 2022.
Salary adjustments
In 2021 the remuneration committee approved a 4,5% annual increase effective December 2021. The only exceptions to this
were the negotiated increases for bargaining unit employees and specific increases to reward high performance, retain critical
skills and address the remuneration objective of fair and responsible pay in the CL and below employee population during the
financial year.
The executive directors received an annual increase but did not receive an STI payment in FY21 whereas all other eligible
employees received an annual increase and STI payment.
Executive directors
NP Doyle
DS Sita
1 Dec 2021 to
1 Dec 2020 to
30 Nov 2022
30 Nov 2021
% increase
10 400 000
6 600 000
10 000 000
6 000 000
4%
10%
FY22 retention awards
In December 2021, in order to address the high attrition rates as well as mitigate against the risk of vacancies in key positions,
a retention mechanism was implemented. The executive committee, excluding the CEO, received once-off retention awards.
› The CFO did not receive an upfront cash retention payment but was awarded a combination of performance vesting and
page 76 of this report. The retention LTIP award made to the CFO took into account
restricted shares which are summarised on
the critical leadership role that the finance discipline, together with other operational and functional leads, plays in executing the
company’s strategy. More specifically, consideration was given to the CFO’s diverse strategic and transformational portfolio,
which includes information technology and group procurement, which are fundamental to ensuring business value across the
enterprise, as well as her role as an executive director of the company. To this end, the retention award took the form of LTIs,
combining Performance Vesting Shares and Restricted Shares, with both instruments subject to a vesting period of three years.
The combined award amounted to a total value of R14,8 million. The quantum of the award had to be significant enough to
create the retention benefit required to ensure a three-year retention. The vesting criteria for these retention awards are set out
on
page 76.
› Each of the other members of the executive committee (excluding the CFO) received:
» An upfront cash retention payment equal to either 50% or 75% of an executive’s TRP for one year. In turn, the executive
agreed to a two-year lock-in period. In the event that the executive exits the company prior to expiry of the retention period,
the upfront payment is repayable in full (gross of taxation). The upfront cash retention payments amounted to R24,1 million
» An allocation of LTIs split between restricted shares at a maximum allocation of 75% and performance shares at a minimum
allocation of 25%, the face value of which was determined in accordance with the principles as outlined in the table on
page 76. These LTIs were allocated in lieu of the annual award of performance shares. The vesting criteria for these
retention awards are set out on
page 76.
2022 short-term incentive
As indicated in the policy section, the STI for executive directors is based on the combination of a group performance factor
and individual performance component.
www.tigerbrands.com
Executive directors
The group performance factor for executive directors is weighted according to the table below. Results for FY22 were as follows:
Strategic
objective
Growth
Strategic
objective
weighting
Key performance
indicator
65% Sales volume growth
Key
performance
indicator
weighting
10%
Efficiency
10%
Brand health*
Innovation
EBIT
Overall equipment
effectiveness
(factor in waste)
Threshold
score =
50%
92%
On-target
score
= 100%
100%
98%
92%
95%
100%
100%
100%
Stretch
score
= 200%
108%
105%
108%
105%
Achievement
Actual
result
0,9%
26,3%
4,3%
Weighted
result
0,00%
0,00%
0,00%
R3,3 billion
70,28%
Improvement in overall equipment
effectiveness year-on-year
80%
100%
120%
3,2%
0,00%
Material usage variance (Rm)
85%
100%
115%
74,14%
10,00%
Reduction in complaints year-on-year
83%
100%
125%
14%
16,67%
7,5%
7,5%
40%
5%
5%
10%
10%
Safety (LTIFR)**
Leadership positions
filled internally
Reduction in lost-time injuries year-on-year
108%
100%
92%
5%
80%
100%
120%
73%
40%
0,00%
2,65%
99,59%
* Brand health is measured on an individual category and not on an aggregated basis.
** The safety KPI has a disqualifier linked to it and even though “Stretch” target was achieved, due to a fatality on a site, the safety KPI (LTIFR), as shown in the
table above, was not met by the group.
The targeted percentages for “threshold”, “target” and “stretch” as set out above per KPI represent the targeted percentage
achievement of the underlying budgeted amounts.
Linear vesting will apply if the actual result falls between “threshold” and “target” or between “target” and “stretch”.
Individual performance
Executive directors individual KPIs are aligned to the group’s KPIs. FY22 group KPIs and their achievement are listed above.
The individual performance factor for executive directors is weighted according to the table below. The results for FY22 were
as follows:
Key indicators
Not met
Individual KPIs
Partially
met
NP Doyle
DS Sita
%
achievement
Partially
Met Exceeded of target
Not met met
Met Exceeded
%
achievement
of target
Met
Partially met
Not met
GP*
On-target %
Actual group
performance
factor %
Actual individual
performance
factor %
10 400 000
6 600 000
x
x
60%
60%
x
x
99,59%
99,59%
+
+
100%
130%
Name
NP Doyle
DS Sita
2022 STI
(Rand)
6 219 647
4 184 683
2021 STI
(Rand)
–
–
* Annual guaranteed package in rand as at 30 September 2022.
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Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance
REMUNERATION AND PERFORMANCE CONTINUED
www.tigerbrands.com
2022 long-term incentives
In FY22, performance shares were awarded to executive directors, executive committee members, senior management and
middle management. Grants of specific retention shares were also made to selected senior management and key people whose
contribution has been identified as being critical to achieving our business strategy.
Long-term incentive awards made during the year to executive directors are set out below:
Compliance with remuneration policy
There were no deviations from the remuneration policy in the financial year.
Single total figure of remuneration
The following tables disclose total remuneration received and receivable by executive directors and executive management for
the period 1 October 2021 to 30 September 2022:
Long-term incentive awards to executive directors for FY22
Executive directors
Name
NP Doyle
LTI personal
performance
multiplier1
GP
(R)
150%
10 400 000
Performance shares
Award %
81,3
Number
69 700
Face value
(R)
Expected value
(R)
12 683 309
15 600 470
1
The personal performance multiplier is used to modify the standard quantum of performance shares and restricted shares, based on an individual’s personal
sustained performance and potential. This is a percentage ranging from 0% to 150%.
2 Allocated on 15 December 2021 at VWAP of R181,97.
Retention awards
Name
DS Sita
DS Sita
GP
(R)
Number
Face value
(R)
Expected value
(R)
Restricted shares
6 600 000
72 540
13 200 103
11 880 093
Performance shares
6 600 000
9 220
1 677 763
2 063 648
1 Allocated on 15 December 2021 at VWAP of R181,97.
LTI awards vesting or with a performance period ending in FY22
The outcome for awards due to vest in FY22, and whose performance conditions ended by 30 September 2022, are shown
below. This applies to all eligible participants.
LTI allocation
Bonus-matching shares granted in FY19
Share appreciation rights granted in FY17 – third tranche
Share appreciation rights granted in FY18 – second tranche
Share appreciation rights granted in FY19 – first tranche
Met
Partially met
Not met
Current minimum shareholding summary
LTI measures
Real HEPS growth
N/A
Performance condition result
% vesting
100% (time-based vesting)
–
–
–
Name
NP Doyle
Date of engagement
1 July 2012
GP1
(R)
10 400 000
Original value
Number of of shares held
(R)
shares held
4 199 926
12 775
Current value
of shares held2 Original value
as % of GP
40
(R)
2 164 596
Target Years remaining
to meet target
0
% of GP
200
CXO1
5 December 2016
4 114 240
7 373
1 638 700
1 249 281
40
100
0
1 GP as at 30 September 2022.
2 Value calculated with reference to the closing price of a Tiger Brands’ share as at 30 September 2022, ie R169,44.
Payments for termination of office
No additional payments were made for executives terminating office.
82
82
Remuneration element
Basic salary
Retirement funding
Other benefits
Guaranteed package
Short-term incentive
Cash remuneration
SARs
Bonus matching shares
Deferred bonus shares and company matching shares
Cash sign-on bonus
Total remuneration
Member of executive committee
(R’000)
8 878
1 455
–
10 333
6 219
10 333
–
–
–
–
16 552
Key
CXO1
CXO3
CXO4
CXO5
CXO6
CXO7
CXO8
CXO13
CXO14
CXO15
CXO16
CXO17
Total
Notes:
NP Doyle
FY22
FY21
DS Sita
FY22
FY21
%
change
(R’000)
(R’000)
%
change
(R’000)
8 591
1 409
–
10 000
–
10 000
–
–
–
–
10 000
65,5
10 697
5 938
330
245
6 513
4 184
6 513
–
–
–
4 957
335
228
5 520
5 520
–
–
–
1 818
7 337
FY22
(R’000)
8 605*
11 551*
12 671*
3 768
13 774*
1 314
10 770*
15 077*
2 777
7 399*
9 723
1 635
99 064
45,8
FY21
(R’000)
3 956
4 985
3 044
4 565
5 513
5 347
4 221
4 820
3 433
–
6 500
–
46 384
83
CXO4 rejoined on 1 November 2021.
CXO5 resigned 31 May 2022.
CXO7 resigned 31 December 2021.
CXO14 resigned 31 December 2021.
CXO15 appointed as executive on 1 January 2022.
CXO16 fixed term contract – FY22 remuneration includes FY22 STI payable in December 2022.
CXO17 acted for the period May 2022 to December 2022 – includes FY22 STI payable in December 2022.
*
Includes retention payments made in December 2021 of R24,1 million as well as FY22 STI payable in December 2022 of R36,1 million.
Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance
REMUNERATION AND PERFORMANCE CONTINUED
Number and value of LTI share awards
Disclosure of the quantum and value of awards for the CEO and CFO outstanding at the beginning and end of the reporting
period, as well as new awards made in the period, are provided in the tables below, with the cash value of awards settled during
the reporting period indicated in the value-based tables.
Award date
Vesting date
Grant price
(R)
Opening
number
Name and awards
NP Doyle
FY20 performance shares
FY21 performance shares
FY22 performance shares
FY17 SARs
FY18 SARs
FY19 SARs
Total
DS Sita
FY21 performance shares
FY22 performance shares
FY22 restricted shares
Total
07/09/2020
04/12/2020
15/12/2021
07/12/2016
11/12/2017
06/12/2018
07/09/2023
04/12/2023
15/12/2024
07/12/2021
11/12/2021
11/12/2022
06/12/2021
06/12/2022
06/12/2023
04/12/2020
04/12/2023
15/12/2021
15/12/2024
15/12/2021
15/12/2024
Granted
during
the year
–
–
69 700
–
–
–
–
–
–
–
–
–
368,11
385,29
385,29
254,79
254,79
254,79
65 880
59 930
–
12 112
16 433
16 433
18 895
18 896
18 897
227 476
69 700
–
–
–
–
31 680
–
–
31 680
–
9 220
72 540
81 760
Forfeited
during
the year
Performance
condition
achieved
Settled
during
the year
–
–
–
12 112
16 432
–
18 895
–
–
47 439
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Closing
number
65 880
59 930
69 700
–
–
Face value
at award
(R)
11 741 792
12 195 755
12 683 309
–
–
16 434
6 331 471
–
18 896
18 897
–
4 814 512
4 814 767
249 736
52 581 606
31 680
9 220
72 540
6 446 880
1 677 763
13 200 104
113 440
21 324 747
Interests of executive directors in B-BBEE schemes
DS Sita was awarded shares in terms of the black managers trust scheme for the year ended 30 September 2022.
Name and awards
DS Sita
Award date
Vesting date
Tiger Brands share allocation
31/01/2021
Adcock Ingram share allocation3
31/01/2021
Oceana share allocation3
31/01/2021
31/01/2024
31/01/2025
31/01/2026
31/01/2024
31/01/2025
31/01/2026
31/01/2024
31/01/2025
31/01/2026
Total
Opening
number
2 333
2 333
2 334
1 983
1 983
1 984
603
604
604
14 761
Granted
during
the year
Forfeited
during
the year
Settled
during
the year
Closing
number
Face value
at award1
(R)
Cash
received
(R)
Value of
shares
acquired
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
2 333
2 333
2 334
1 983
1 983
1 984
603
604
604
334 995
334 995
335 139
63 278
63 278
63 309
30 554
30 605
30 605
14 761
1 286 758
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1 Calculated with reference to the market value of an allocated share (less the amount of the capital contribution) as at the date of the award.
2 Calculated with reference to the market value of an allocated share (less the amount of the capital contribution) as at year end (30 September 2022).
3 In addition to the award of the Tiger Brands shares, the executive was also awarded Adcock Ingram and Oceana shares (as a consequence of the unbundling by
Tiger Brands of its interests in Adcock Ingram and Oceana, the Tiger Brands Black Managers Trust, as Tiger Brands shareholder, also became a shareholder of
shares in Adcock Ingram and Oceana). Participants in the Trust are, consequently, also awarded shares in these two companies when awarded Tiger Brands shares.
84
84
www.tigerbrands.com
Cash
received
(R)
Value of
shares
acquired
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Closing
fair value
vesting2
(R)
290 272
290 272
290 396
66 867
66 867
66 900
24 174
24 214
24 214
1 144 176
Closing
fair value
vesting
(R)
10 741 734
9 711 057
10 827 198
–
–
657
–
72 372
73 131
31 426 149
5 133 427
1 432 235
11 268 364
17 834 026
85
Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance REMUNERATION AND PERFORMANCE CONTINUED
Non-executive directors’ remuneration 2022
The non-executive directors’ remuneration paid for the year ended 30 September 2022 is disclosed below, excluding VAT in rand:
www.tigerbrands.com
MO Ajukwu
MJ Bowman
FNJ Braeken
CH Fernandez
GJ Fraser-Moleketi
GA Klintworth
M Makanjee
TE Mashilwane
M Sello
OM Weber
DG Wilson
LA Swartz
Committee
Notes
Board fees
Audit committee fees
Investment committee fees
Remuneration committee, nomination and governance committee fees
122 948
Social, ethics and transformation committee fees
Risk and sustainability committee fees
Extraordinary fees in respect of special board meeting
126 500
361 358
54 984
1 020 626
217 500
1
2
520 376
232 416
443 750
14 262
184 230
54 984
157 112
23 906
2 119 464
1 020 626
108 750
443 750
3
245 964
184 230
54 984
23 906
28 711
50 729
23 406
59 700
182 200
23 906
443 750
198 212
106 942
308 030
23 906
1 020 626
53 834
137 310
361 356
54 984
Ad hoc work/meetings
Total FY22
Total FY21
1. MJ Bowman retired 16 February 2022.
2. FNJ Braeken appointed 1 April 2022.
3. M Makanjee retired 31 December 2021.
4. LA Swartz appointed 1 June 2022.
1 563 468
1 460 495
340 448
754 303
992 006
990 714
1 027 821
2 143 370
1 505 804
1 713 171
1 345 170
188 190
798 733
732 962
1 080 840
1 628 110
713 327
908 565
1 440 285
4
113 125
29 850
142 975
443 750
198 212
23 406
185 272
23 906
874 546
868 442
86
86
87
Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance DECLARATION OF FINAL
DIVIDEND
The board declared a final ordinary dividend of 653 cents per share for the year ended 30 September 2022.
In accordance with paragraphs 11.17 (a) (i) to (x) and 11.17 (c) of the JSE Listings Requirements, the following additional information
is disclosed:
› The ordinary final dividend has been declared out of income reserves
› The local dividends tax rate is 20% (twenty percent), effective 22 February 2017
› The gross final dividend amount of 653,00000 cents per ordinary share will be paid to shareholders who are exempt from
the dividends tax
› The net final dividend amount of 522,40000 cents per ordinary share will be paid to shareholders who are liable for the
dividends tax
› Tiger Brands has 180 327 980 ordinary shares in issue (which includes 10 326 758 treasury shares)
› Tiger Brands Limited’s income tax reference number is 9325/110/71/7.
Shareholders are advised of the following dates in respect of the final ordinary dividend:
Declaration date
Last day to trade cum the ordinary dividend
Shares commence trading ex the ordinary dividend
Record date to determine those shareholders entitled to the ordinary dividend
Payment date in respect of the ordinary dividend
Friday, 2 December 2022
Tuesday, 17 January 2023
Wednesday, 18 January 2023
Friday, 20 January 2023
Monday, 23 January 2023
Share certificates may not be dematerialised or re-materialised between Wednesday, 18 January 2023 and Friday, 20 January 2023,
both days inclusive.
By order of the board
JK Monaisa
Company secretary
Bryanston
1 December 2022
COMPANY INFORMATION
www.tigerbrands.com
Tiger Brands Limited
(Tiger Brands or the company)
(Incorporated in the Republic of South Africa)
Share code: TBS
ISIN: ZAE000071080
Independent non-executive directors
GJ Fraser-Moleketi (chairman), MO Ajukwu,
FNJ Braeken, CH Fernandez, GA Klintworth,
TE Mashilwane, M Sello, LA Swartz,
OM Weber, DG Wilson
Executive directors
NP Doyle (chief executive officer)
DS Sita (chief financial officer)
Company secretary
JK Monaisa
Registered office
3010 William Nicol Drive
Bryanston
Sandton
Postal address
PO Box 78056, Sandton, 2146
Telephone: +27 11 840 4000
Auditors
Ernst & Young Inc.
Principal banker
Rand Merchant Bank
Sponsor
JP Morgan Equities South Africa (Pty) Limited
South African share transfer secretaries
Computershare Investor Services
Proprietary Limited
Rosebank Towers, 15 Biermann Avenue
Rosebank, 2196
Private Bag X9000
Saxonwold, 2132
American Depository Receipt (ADR) facility
ADR Administrator
The Bank of New York Mellon
Investor relations
Nikki Catrakilis-Wagner
Erene Kairuz
Telephone: +27 11 840 4000
Website address
www.tigerbrands.com
Contact details
Companysecretary@tigerbrands.com
Investorrelations@tigerbrands.com
Consumer helpline: 0860 005342
88
88
89
Forward-looking information
This report contains forward-looking statements that, unless otherwise indicated, reflect the company’s expectations at the time of
finalising the report. Actual results may differ materially from these expectations if known and unknown risks or uncertainties affect
the business, or if estimates or assumptions prove inaccurate. Tiger Brands cannot guarantee that any forward-looking statement
will materialise and, accordingly, readers are cautioned not to place undue reliance on these statements. The company assumes
no obligation to update or revise any forward-looking statements, even if new information becomes available as a result of future
events or for any other reason, save as required by legislation or regulation.
Tiger Brands Limited Integrated annual report 2022Our operating contextOur strategyOur performanceOur businessOverviewOur governance
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