The Bega Cheese Ltd (ASX: BGA) share price has been a top performer in 2021. Shares in the Aussie food company have climbed 23.6% higher to $6.44 per share as at Tuesday's close. That represents an outperformance of 18.6% over the S&P/ASX 200 Index (ASX: XJO) so far this year.
In fact, Bega shares started Tuesday's session by hitting a new 52-week high of $6.58 per share. So, what's helping propel this iconic Aussie company higher in 2021?
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Why is the Bega Cheese share price surging higher?
There haven't been too many announcements from the Aussie company in 2021. In fact, the major update this year came in late February with Bega's half-year results.
Bega reported some seriously strong growth figures for the half-year ended 31 December 2021 (1H 2021). Statutory earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 68% year-on-year to $65.8 million despite a 5% dip in revenue. On a normalised basis, group EBITDA was up 51% to $73.0 million for the half.
Those strong earnings figures were also reflected in the company's bottom line. Bega reported a normalised profit after tax up 98% to $29.7 million with earnings per share up 89% to 13.2 cents.
That result came despite some challenging market conditions including a strengthening Aussie dollar and lower global commodity prices. The company said it reflected its renewed focus on innovation and strategic priorities as well as a growing market share for its spreads business.
A strong half-year result helped to propel the Bega Cheese share price higher in February. The Aussie food group's valuation has also been helped by bullish market sentiment pushing ASX 200 shares higher so far this year.
Another factor has been Bega's high profile Lion Dairy and Drinks acquisition in late 2020. Bega completed the $534.1 million acquisition on 25 January 2021 in a big step forward for the Aussie food company.
The Bega Cheese share price closed at $6.44 per share yesterday after falling from its $6.58 52-week high during the day's trade. The company now boasts a $1.95 billion market capitalisation at a price to earnings (P/E) ratio of 41.8.
