RFG Holdings (RFG) H2 2024 earnings summary

Executive summary

• Group operating profit margin reached 10.6%, exceeding the target, driven by strong regional performance and cost control, while international profits declined due to softer pricing and shipping delays.

• Regional volumes recovered in H2, growing 3.2%, but international volumes declined 11.4% due to shipping delays and weaker global pricing.

• Board increased dividend payout ratio to 50%, reflecting confidence in profitability and cash generation.

• Headline earnings rose 18.2% to R577 million; headline EPS up 18.6% to 222.2 cents.

• Dividend per share increased 79.2% to 111.1 cents.

Financial highlights

• Group revenue grew 1.5% to R8.0 billion; regional revenue up 5.9% to R6.4 billion; international revenue down 12.5% to R1.6 billion.

• Group operating profit increased 12.7% to R852 million; regional operating profit up 28.1% to R675 million; international operating profit down 22.8% to R189 million.

• EBITDA rose 9.8% to R1,158 million, margin improved to 14.5%.

• Net debt reduced by 37.1% to R457 million; net debt to equity improved to 11.9%, net debt to EBITDA to 0.4x.

• Free cash flow was R545 million, free cash flow return at 6.8%.

Outlook and guidance

• Strategy focuses on input cost recovery, tight cost management, efficiency improvements, and innovation.

• Regional revenue growth expected to continue, supported by Q4 momentum, product innovation, and improved consumer confidence; operating margin targeted at 10%.

• International segment aims to maintain margin within 7.5%-12.5% despite headwinds from exchange rates, lower global pricing, and reduced pineapple volumes.

• Capital investment of R430 million planned for the new financial year, including major upgrades and capacity expansions.