RCL Foods, one of SA’s biggest chicken producers, says it faces a bleak future as it lays off 1,355 workers — or half the workforce — at its large Hammarsdale operations in KwaZulu-Natal. It says the South African chicken industry faces "severe challenges" from dumped imports and high chicken-feed input costs due to drought. This will see headline earnings per share plunge between 54.1% and 36.9% in the six months ended December compared to the same period in 2015. "The chicken business unit has initiated a programme to reduce its Hammarsdale operations to a single shift … eliminating a portion of unprofitable IQF [individually quick-frozen] product," the group said in a trading update on Tuesday. The update included three abnormal items: R37.4m after-tax provision for restructuring costs linked to the reduction in chicken volumes; an after-tax impairment of R102.7m for redundant plant and equipment related to this, and a foreign exchange loss of R27.9m. Scott Pitman, MD of the grou...

BL Premium

This article is reserved for our subscribers.

A subscription helps you enjoy the best of our business content every day along with benefits such as articles from our international business news partners; ProfileData financial data; and digital access to the Sunday Times and Sunday Times Daily.

Already subscribed? Simply sign in below.



Questions or problems? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now