RCL Foods, backed by South Africa’s richest man, reports $730 million in half-year revenue

Key Points

•  RCL Foods’ profit jumped to $63 million in H1 2025, driven by price increases, cost savings, and improved operational efficiencies.
• With Rainbow unbundling complete, RCL Foods refocuses on branded goods and reinstates a $0.0107 per share dividend after skipping last year’s payout.
• RCL Foods anticipates soft demand but sees potential recovery in 2025, focusing on margin improvements, risk mitigation, and resilience in energy and water.

RCL Foods, a consumer goods and milling company backed by South Africa’s richest man Johann Rupert, delivered a solid financial performance in the first half of its 2025 fiscal year. Revenue climbed to $730 million, while profit surged to $63 million, reflecting strong execution across key segments.

Profit jumps on pricing, cost controls

According to the group’s latest interim results, revenue rose 5.4 percent from R12.86 billion ($690.4 million) in the first half of 2024 to R13.56 billion ($730 million). The growth was mainly driven by higher realized prices across most categories, along with a sharp focus on cost savings and production efficiencies. These efforts paid off, with profit increasing from R1.015 billion ($54.5 million) to R1.168 billion ($63 million) over the same period.

The strongest gains came from the Groceries and Baking segments, along with a partial recovery of the additional levy imposed by the South African Sugar Association (Sasa) last year. The sugar division saw improvements in operations and a reduced reliance on lower-margin raw exports. However, the Molatek animal feed unit struggled with an unfavorable sales mix and rising input costs. In contrast, the Groceries segment benefited from strong demand for pet food, lower raw material costs, and production efficiencies. The Baking unit also delivered better results, supported by pricing strategies and reduced load shedding.

RCL Foods refocuses, resumes dividend payout

Founded in 1960 as Rainbow Chicken Ltd, RCL Foods is majority-owned by Remgro, an investment holding company controlled by Rupert. The company, known for brands like Selati sugar, Ouma rusks, and Yum Yum peanut butter, has been reshaping its business. With the disposal of Vector Logistics and the unbundling of Rainbow now complete, RCL Foods is sharpening its focus on building a future-ready, branded business that delivers steady earnings and long-term value.

As part of this progress, the company announced: “Overall, we believe we have made good progress on our 2025 financial year priorities. Our strategy is clear, consistent, and delivering results despite a tough operating environment.” Reflecting its improved financial position, the board approved a cash dividend of R0.2 ($0.0107) per share for the six-month period ending December 2024—an improvement from the previous year when no dividend was paid.

RCL Foods eyes growth amid challenges

Looking ahead, RCL Foods expects demand to remain soft in the near term but sees improving macroeconomic conditions supporting a gradual recovery. GDP growth is expected to pick up slightly in 2025, potentially boosting consumer spending and volume growth. However, the company acknowledges that trading conditions will likely remain tough for some time. It plans to continue executing its growth strategy while enhancing margins, mitigating risks from any volume shortfalls, and prioritizing energy and water resilience to keep the business future-ready.