JSE-listed RCL Foods expects its headline earnings per share (HEPS) from total operations for the six months ended December 31 to be between 106c and 112c when compared with the reported HEPS of 80.8c from total operations for the six months ended December 31, 2023.

The company reports that earnings per share (EPS) from total operations for the current period are expected to be between 131c and 138c when compared with the reported EPS from total operations of 119.8c for the comparative period.

The expected difference between EPS and HEPS is largely owing to, among other items, the current period EPS including the non-cash gain realised on accounting for the unbundling of poultry producer Rainbow, and the comparative period EPS including the gain on disposal of Vector Logistics.

The company says total operations relate to the sum of continuing and discontinued operations of the group.

In the current period, continuing operations relate to the remaining RCL Foods business – comprising the groceries, baking, sugar and group segments – post the unbundling of Rainbow on July 1 2024 and disposal of Vector Logistics in the 2024 financial year.

In the current period, the discontinued operation relates solely to the non-cash gain realised on accounting for the unbundling of Rainbow, says RCL Foods.

RCL Foods also notes that it expects its HEPS from continuing operations for the period under review to be between 106c and 112c when compared to the restated HEPS of 78.8c from continuing operations for the comparative period of the prior financial year.

“The improved headline earnings performance across the continuing operations was largely due to gains in groceries and baking, as well as a partial recovery of the additional levy raised by the South African Sugar Association (SASA) in our 2023 financial year on the Sugar business unit, as a result of Tongaat and Gledhow suspending payment of their industry obligations.”

The company says volumes remained under pressure over the current period in most of the groceries and baking categories, with a focus on continuous improvement and net revenue management initiatives, optimising sales mix, lower input costs and the continued suspension of loadshedding driving their improved result.

After consecutive years of record performance off a high base, RCL Foods says sugar continued to perform well, aided by continuous improvements in operational performance and a reduced industry exposure to lower margin raw exports.

The group's financial results for the six-month period are expected to be released on March 3.