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Group interim financial results and cash dividend declaration for the period ended December 2019

  • Revenue up 7.1% to R14,2 billion
  • Earnings before depreciation, amortisation and impairment
      (EBITDA) up 7.7% to R1 165,7 million
  • Underlying* EBITDA up 11.1% to R1 033,3 million
  • Headline earnings per share (HEPS) down 2.7% to 53.3 cents
  • Underlying* HEPS up 23.8% to 63.0 cents
  • Earnings per share (EPS) down 6.1% to 62.6 cents
  • Underlying* EPS up 20.8% to 63.2 cents
  • Cash generated by operations up 20.8% to R842,8 million
  • Interim dividend declared of 15.0 cents per share, in line
      with prior period


*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
full announcement for further details.


During the period under review, RCL FOODS restructured its
business by combining the Consumer and Sugar & Milling divisions
into a single Food division with the previous eight business units
restructured into four new business units (Groceries, Baking,
Chicken and Sugar). The restructuring has established business
units that are closely aligned and integrated which provides a
solid foundation for creating further synergies, optimising
resource allocation and sharpening our strategic focus.


RCL FOODS reported an improvement in underlying results for the
period ended December 2019, driven by gains in Sugar. Cash
generated by operations increased 20.8% as a result of the
improved profitability.


Despite ongoing consumer pressure and aggressive competitor
activity, Groceries delivered another consistent result stemming
from innovation-driven pet food volume growth and well-controlled
costs. Baking was negatively impacted by volume pressure and
margin declines due to the inability to fully recover input cost
increases, however the Speciality category reported a pleasing
improvement following the prepared lines exit in the prior
financial year. Chicken’s result was negatively impacted by
pricing pressure in the retail/wholesale channel, resulting from
industry oversupply, which was exacerbated by increased feed costs
and agricultural challenges. Sugar benefitted from an increase in
sales volumes, largely due to higher raw exports and improved
local and international pricing. Local sugar demand remains muted
due to financial pressure on consumers and declines in consumption
brought about by the implementation of the Health Promotion Levy
(sugar tax). Vector’s results included a R110,0 million gain on
bargain purchase arising from the acquisition of the Imperial
Logistics South Africa Group Proprietary Limited’s cold chain
business (“ICL”). Vector’s underlying performance (excluding the
R110,0 million gain) was significantly down on the prior period,
negatively impacted by higher costs associated with the take-on of
new business and operating the combined Vector and acquired ICL
networks from December 2019.


EPS for the current period is higher than HEPS largely due to a
gain on bargain purchase arising from the initial accounting for
the Vector acquisition of ICL of R110,0 million (R79,2 million




Notice is hereby given that the directors have declared an interim
gross cash dividend (number 90) of 15.0 cents (12.0 cents net of
dividend withholding tax) for the six months ended December 2019.


The dividend has been declared from income reserves.


A dividend withholding tax of 20% will be applicable to all
shareholders who are not exempt.


The issued share capital at the declaration date is 940 901 560
ordinary shares. The company’s income tax reference number is


The salient dates for the dividend will be as follows:
Publication of declaration data                      Monday, 2 March 2020
Last day of trade to receive a dividend        Tuesday, 21 April 2020
Shares commence trading “ex” dividend      Wednesday, 22 April 2020
Record date                                                     Friday, 24 April 2020
Payment date                                                  Tuesday, 28 April 2020
Share certificates may not be dematerialised or rematerialised
between Wednesday, 22 April 2020 and Friday, 24 April 2020, both
days inclusive


The contents of this short-form announcement are the
responsibility of the board of directors of the Group.


Shareholders are advised that this short-form announcement
represents a summary of the information contained in the full
announcement and does not contain full or complete details as
published on the RCL FOODS website, on 2 March