RCL Foods reports positive 2024 financial results

SOUTH AFRICA – RCL Foods, the owner of the Ultra Pet brand, has posted a strong set of full-year financial results for 2024, despite facing significant pressures in a challenging economic environment that has weighed heavily on consumer demand.

The group’s revenue rose by 6.8% year-on-year, reflecting resilient performance in the face of these conditions.

The company’s underlying earnings before interest, tax, depreciation, amortisation, and impairments (EBITDA) saw a 15.5% increase.

Additionally, underlying headline earnings, which exclude material once-off adjustments, grew by 8.3%, amounting to R1.137 billion (US$75M).

As part of its long-term strategy to refine its business focus, RCL Foods has completed two major portfolio restructuring milestones.

The first was the sale of its logistics arm, Vector Logistics, which was finalised in August 2023.

The second was the separation of its poultry division, Rainbow Chicken, which officially exited the group on July 1, 2024, to pursue an independent course.

The sale of Vector Logistics to EMIF II Investment Proprietary Limited, a subsidiary of Denmark-based A.P. Møller Capital, marked a significant moment for the company.

A 12-month transitional service agreement, which allowed for a smooth handover, concluded in August 2024.

Although the companies will continue to work together under several contractual agreements, RCL Foods views this as a strategic victory that benefits both parties.

Rainbow Chicken, a major player in South Africa’s poultry industry, was also spun off from RCL Foods with its shares publicly listed on the Johannesburg Stock Exchange (JSE) in June 2024.

The initial public offering (IPO) involved 890.3 million shares priced at R2.85 each (US$0.13).

Rainbow Chicken had previously been under the control of Remgro, the investment firm of billionaire Johann Rupert, but the split is intended to allow both companies to focus on their respective strengths.