RCL FOODS LIMITED - Group financial results and cash dividend declaration for the year ended June 2019

Group financial results and cash dividend declaration for the year ended June 2019

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

GROUP FINANCIAL RESULTS AND CASH DIVIDEND DECLARATION FOR THE YEAR
ENDED JUNE 2019

  -   Revenue up 5.5% to R25,9 billion
  -   Earnings before depreciation, amortisation and impairment
      (EBITDA) down 25.4% to R1 525,7 million
  -   Headline earnings per share (HEPS) down 60.8% to 37.9 cents
  -   Earnings per share (EPS) down 111.9% to negative 12.7 cents
  -   Final dividend declared down 60.0% to 10.0 cents

RCL FOODS’ revenue for the period increased 5.5% to R25,9 billion
driven largely by volume gains in most business units coupled with
commodity driven price increases in Animal Feed. Despite the
revenue improvement, profitability declined mainly due to the
adverse performance of the Sugar and Chicken business units.
Declining local market demand, mainly due to the implementation of
the Health Promotion Levy (sugar tax), resulted in an adverse
sales mix and a significantly lower Sugar result. Chicken was
negatively impacted by low selling prices due to an oversupplied
retail poultry market with dumped imports at record levels, as
well as a rising feed cost environment.

The significant decline in Sugar’s profitability led the Group to
perform a detailed impairment review on the Sugar cash-generating
unit (CGU). Based on the current outlook of a permanent reduction
in local market demand, a higher proportion of our future
production is expected to be exported at significantly lower
margins. An impairment of R761,9 million has been recorded in the
current financial year against non-current assets.

Groceries delivered another strong result on the back of volume
gains and margin improvement in most categories. Millbake
continues to improve, with Baking being the main driver of the
improved result. Higher costs drove lower margins in Animal Feed
and Logistics.

Earnings per share is lower than headline earnings per share
largely due to the R761,9 million (R552,5 million post-tax)
impairment in Sugar.
CASH DIVIDEND DECLARATION
 
Notice is hereby given that the directors have declared a final
gross cash dividend (number 89) of 10.0 cents (8.0 cents net of
dividend withholding tax), bringing the total dividend declared for
the year ended June 2019 to 25.0 cents (2018: 40.0 cents).

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
9950019712.

The salient dates for the dividend will be as follows:

Publication of declaration data              Monday, 2 September 2019
Last day of trade to receive a dividend      Tuesday, 29 October 2019
Shares commence trading “ex” dividend      Wednesday, 30 October 2019
Record date                                   Friday, 1 November 2019
Payment date                                  Monday, 4 November 2019

Share certificates may not be dematerialised or rematerialised
between Wednesday, 30 October 2019 and Friday, 1 November 2019
(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, www.rclfoods.com on 2
September 2019.

Any investment decisions by investors and/or shareholders should
be based on a consideration of the full announcement as a whole
and shareholders are encouraged to review the full announcement,
which is available for viewing at
https://senspdf.jse.co.za/documents/2019/JSE/ISSE/RCL/02092019.pdf
or on the Group’s website set out above. Copies of the full
announcement may be requested at the Group’s registered office and
offices of its sponsor at no charge, during office hours of 08h00
to 16h30, Monday to Friday. Investors and/or shareholders may also
request copies of the full announcement by contacting the company
secretary at john.maher@rclfoods.com or on 087 362 8501.

Durban
2 September 2019

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

Date: 02/09/2019 07:05:00
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