Monday was 'food day' on the JSE as the three producers released results that could have been so much better if they weren't forced to hike prices to offset the cost of keeping the lights on.
The South African Sugar Association's levy, input costs and rolling power cuts have made doing business expensive in South Africa, with RCL on Monday reporting a 46% plunge in annual profits; AVI - whose food products include Five Roses, Baumann's and Provita - posting a moderate profit; and Sea Harvest registering a hit by cost pressures.
To offset operational pressures, producers were forced to hike prices.
RCL Foods has increased group revenue by 17.3% to R37.8-billion; AVI bumped up revenue by 7.8% to R14.91-billion; and Sea Harvest by 10% to R1.57-billion.
The producer of Ouma Rusks, Selati Sugar, Rainbow and Yum Yum peanut butter says the sugar industry's special levy has "materially" hurt its profits, with rolling blackouts affecting all of RCL's operations.
Rolling blackouts cost the company R158.3-million (pretax) in FY 2023 and affected its service levels, particularly in its pet food division.
Despite the decline in annual profits, RCL's revenue was up 17.3% on last year, mainly due to higher pricing to offset rising input costs. Earnings before interest, taxes, depreciation and amortisation (Ebitda) from continuing operations declined by 24.5%, mainly due to the decline in Rainbow Chicken.
It says its key grocery brands are growing, despite a...