In the two years after its October 2014 listing, Rhodes Food Group could seemingly not put a foot wrong. Fuelled by an aggressive acquisition strategy and solid organic growth, annual revenue more than doubled and headline EPS (HEPS) soared almost fivefold.But even well-managed firms are not immune to market forces, as Rhodes found in its year to October 2017. It was left nursing a 27% HEPS fall after a serious setback in its non-African international fruit product export division in the second half of the year.That division, which contributed R190m (38%) of group operating profit in the previous year, was hit by a strengthening rand, the Western Cape drought and lower US dollar prices for some products. Its annual operating profit dived to R58m, with only R8m generated in the second half.A quick recovery seems unlikely. "Things are going to be very tough given the forex situation," says Rhodes CEO Bruce Henderson, referring to an almost 20% strengthening in the rand/dollar exchange...
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