RFG to report big rise in earnings

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RFG to report big rise in earnings

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Published Date: 2021-05-03 | Source: Stephen Gunnion | Author: Stephen Gunnion

RFG to report big rise in earnings

Despite a dip in turnover due to ongoing Covid-19 restrictions and congestion at the Cape Town harbour, earnings will be significantly higher.

RFG Holdings will report a strong rise in first-half earnings after benefitting from positive foreign exchange movements and a lower interest bill.

The company, which changed its name from Rhodes Food Group, said in a trading statement that its operating performance was also resilient despite the impact of Covid-19 on its trading environment.

Turnover for the six months to end-March fell by 3.4% due to the impact of restrictions on its fruit juice and pie operations, slower export volumes in March due to congestion at the Cape Town harbour, and the strong base effect from March 2020 ahead of the first national lockdown. However, it said headline earnings for the period would be as much as 49% higher than the R81.6-million reported last year. It paid R19.2-million less in interest due to lower interest rates and reduced debt levels, while it booked a foreign exchange gain of R67.2-million. In the year to September 2020, it suffered net foreign exchange losses of R54.6 million after gains of R24.1 million in 2019.

Over the period, it incurred once-off costs of R14.9-million related to the centralisation of its pies and pastries business and R16.8-million for related property impairments.

It expects earnings per share (EPS) to be between 32% and 37% higher than the 30.2c reported last year, while headline EPS will be 44% to 49% up from the 31.2c previously reported.

RFG's shares closed 0.6% higher at R12.25 on Friday.





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