RCL FOODS LIMITED - Group financial results for the six months ended December 2023
04 March 2024 7:05

Group financial results for the six months ended December 2023

RCL FOODS LIMITED
(Incorporated in the Republic of South Africa)
ISIN: ZAE000179438
Share Code: RCL
("RCL FOODS" or "the Company" or "the Group")

GROUP FINANCIAL RESULTS FOR THE SIX MONTHS ENDED DECEMBER 2023

  •   Revenue from continuing operations up 8.4% to R20,1 billion
  •   Earnings before interest, tax, depreciation, amortisation and
      impairment (EBITDA) from continuing operations up 48.6% to
      R1 506,8 million
  •   Underlying* EBITDA from continuing operations up 32.4% to R1
      436,0 million
  •   Headline earnings per share (HEPS) from continuing operations
      up 52.6% to 81.2 cents
  •   Earnings per share (EPS) from continuing operations up 67.0%
      to 90.0 cents
  •   HEPS from total operations up 43.3% to 80.8 cents
  •   EPS from total operations up 108.0% to 119.8 cents

*The underlying view of the results excludes material once-offs
and accounting adjustments. Refer to the "Reconciliation between
unadjusted and underlying results" section provided as part of the
interim results announcement for further details.

The Vector Logistics segment was classified as a discontinued
operation during the second half of the previous financial year
and was subsequently sold in August 2023. Vector Logistics
reported a profit before tax of R263,1 million for the period to
28 August 2023 which includes the R255,7 million profit arising
from the disposal of the Vector Logistics segment. The information
provided in the balance of this document relates to continuing
operations which refer to the remaining operations excluding the
Vector Logistics segment.

RCL FOODS delivered a pleasing set of results for the six months
ended December 2023 in a challenging environment. The improved
result was mainly attributable to Rainbow and Sugar.

Despite the negative impact of Avian Influenza in the current period,
Rainbow delivered an improved result due to the continued execution
of the turnaround plan, which drove an improvement in agricultural
performance and operating efficiencies, coupled with higher volumes
and margins.

Sugar's improvement was achieved, despite lower crop yields and
largely attributable to higher market prices. Volume challenges in
the Culinary category, partially offset by the recovery in volumes
in the Pet Food category, following a restoration of service
levels, drove a muted result in the Grocery operating unit.
Despite volume pressure, the Beverages operating unit delivered an
improved result mainly due to strong cost control. Within the
Baking business unit, improved margins in Milling, Pies and
Speciality were partially offset by a disappointing performance in
Bread, Buns & Rolls. The Bread, Buns & Rolls operating unit
continues to face an extremely competitive operating environment,
with higher input costs and promotional activity leading to
further margin pressure.

Following the strategic review of RCL FOODS, the board provided
its preliminary approval on 1 March 2024, to pursue the formal
separation of Rainbow, via an unbundling to shareholders and a
concurrent listing on the JSE. The board is of the view that the
unbundling of Rainbow will enable both businesses to pursue their
respective growth ambitions, and investment theses, in a focused
manner   and  with  improved  alignment   on  capital allocation
priorities.

With the Rainbow separation process still in progress, the board
of directors has resolved not to declare an interim dividend.

The contents of this interim results announcement are the
responsibility of the board of directors of the Company.

Shareholders are advised that this results announcement represents
a summary of the information contained in the unaudited interim
results for the 6 months ended 31 December 2023 ("interim
results") and does not contain full or complete details. The
interim results have been published on The Stock Exchange News
Service and are available at
https://senspdf.jse.co.za/documents/2024/JSE/ISSE/RCL/04032024.pdf and on the RCL FOODS website, 
www.rclfoods.com/investor-center/financial-results-and-investor-presentations on 4 March 2024.

Any investment decisions by investors and/or shareholders should
be based on a consideration of the interim results as a whole and
shareholders are encouraged to review the interim results, which
is available for viewing as set out above.

Westville
4 March 2024

Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Date: 04-03-2024 07:05:00
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