SA credit rating downgrade would harm business: RCL

JOHANNESBURG – Branded foods company RCL Foods yesterday warned that a downgrade of South Africa’s credit rating would harm the business as it reported improved revenue during the half-year to December 2019.

The group said it was pinning its hopes on planned tariffs to counter under-priced chicken imports that are estimated to have cost the local industry more than R6.5billion in annual losses. The group said the tariffs would help it to capitalise on the domestic market.

“The possibility of a credit ratings downgrade for South Africa to sub-investment grade does, however, present an impairment risk over the rest of our financial year,” said RCL.

RCL, whose brands include Sunbake, and Yum Yum peanut butter, again declared an interim 15 cents dividend at the end of December 2019.

It reported that the growth of its sugar business during the half-year ended in December lifted revenue 7.1percent to R14.2bn on strong volumes, particularly in the chicken and sugar divisions.