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Key Points
- RCL Foods expects headline earnings per share to surge by over 100 percent for the fiscal year ending June 30, 2024.
- Earnings per share from operations are projected to rise by up to 167 percent compared to the previous year.
- Rainbow Chicken’s unbundling and listing boost RCL Foods with an anticipated $38 million EBITDA increase.
RCL Foods, a leading South African consumer goods and milling company backed by South Africa’s richest man Johann Rupert, expects a triple-digit percent jump in its earnings for the fiscal year ending June 30, 2024.
The company, partially owned by Remgro Limited, which Johann Rupert chairs, announced this week that it expects headline earnings per share (HEPS) to rise by over 100 percent, driven by strong performances across its core divisions.
According to figures disclosed in the RCL Foods’s trading statement, the company revealed that it expects HEPS to rise between R1.384 ($0.07) and R1.452 ($0.08), representing a 102.6 – 112.6 percent increase from R0.683 ($0.03) in the previous fiscal year.
RCL Foods outperforms, thanks to Rainbow Chicken and strategic divisions
RCL Foods expects a significant surge in earnings per share (EPS) from total operations, with projections ranging from R1.784 ($0.09) to R1.854 ($0.1), representing a remarkable 157.4 percent to 167 percent increase from the previous year’s R0.693 for fiscal year 2023.
This upward revision exceeds the previously reported 75 percent increase in headline earnings per share (HEPS) for fiscal 2023, highlighting the company’s exceptional financial performance.
The improved headline earnings are largely attributed to RCL Foods’ legacy business, Rainbow Chicken, and its grocery division. The company noted that Selati Sugar also contributed to the strong results, particularly in the latter part of the reporting period.
RCL Foods mulls portfolio adjustment
RCL Foods, founded in 1960 as Rainbow Chicken Ltd, is 77 percent owned by Remgro, led by billionaire Johann Rupert. Known for brands like Selati sugar, Ouma rusks, and Yum Yum peanut butter, the company is reviewing its portfolio for shareholder value.
Rainbow Chicken, which was unbundled and listed as a standalone entity on the Johannesburg Stock Exchange’s main board on July 1, 2024, is expected to deliver underlying earnings before interest, tax, depreciation, amortization, and impairments (EBITDA) between R650 million ($36.21 million) and R690 million ($38.43 million) for the current period.
