Food producer RFG Holdings has reported lower earnings at the halfway stage of its financial year, as softer global demand and shifting market dynamics resulted in lower revenue in its international segment.
The group reported a 11.9% decline in headline earnings to R231m for the six months ended March, which translated to headline earnings per share (HEPS) of 88.7c compared with 100.7c a year ago.
Earnings before interest, tax, depreciation and amortisation (ebitda) was 8.8% lower at R503m, it said in a statement on Wednesday. Group operating profit fell 13.9% to R343m.
Total revenue was up by 3.5% to R4bn, with the regional segment recording a a 7.6% increase. However, revenue in the international segment fell 17.2%.
Volumes in both fresh and long-life foods in the regional segment recovered, despite consumer spending remaining under pressure in the domestic market.
Fresh foods led the charge, with ready meals and pies showing significant volume growth, while long-life foods saw double-digit revenue growth in fruit juice, dry foods and pulps and purées.
The performance in the international segment was affected by weaker export volumes due to unfulfilled canned deciduous fruit contracts and the effect of last year’s drought in Eswatini, which hampered pineapple supplies.
The group declared a maiden interim dividend of 29.6c per share following changes in its policy allowing the Bull Brand owner to pay dividends twice a year.
RFG expects the trading momentum in the regional segment to continue into the second half of the year, despite ongoing geopolitical and trade tension and pressure on consumer spending.
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