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Rainbow results for 12 months ended 31 Mar 02

Revenue increased to R3.04bn (R2.49bn), operating profit rose to R156.8m (R115m), and net profit was up at R153.9m (R98.2m). EPS increased to 60cps (38.3cps) and HEPS improved to 60.3c (45.9c). Due to low supply of maize stocks and the weakening of the Rand, overall feed prices rose by approximately 25% – well ahead of inflation. This had a dramatic impact on chicken production costs, especially during the latter half of the year, despite hedged positions within the industry.

Rainbow”s restructuring and streamlining process continues to make good progress and has to date met expectations. Further improvements in key performance indicators and production costs are being achieved. Notwithstanding the challenging conditions prevailing in the industry, the group achieved a good performance in the past year. Mainly as a result of volume growth, mix improvement and higher price realisations in both feed and chicken operations.

Focus on the balance sheet and cash management continued throughout the year. The group continued to operate with fluctuating short-term core borrowings for the year and will continue to incur interest costs in the new year. Provided the current trading conditions and normal cash flow trends prevail for the remainder of the year, interest bearing debt is expected to peak at approximately R60m during the first half of the new year.

Management”s main focus will remain on the continuation of its successful streamlining process to further reduce costs and improve efficiencies, market effectiveness and customer service.

Mr PJ Waud will retire as a non-executive director on 31 Jul 02.