South Africa’s RCL Foods, which owns Rainbow Chicken and Selati Sugar, has warned of a sharp drop in profits as a result of the COVID-19 pandemic. Initial indications are that profits might fall by as much as 30% in the financial year to end June.

RCL Foods operates in South Africa, Swaziland, Namibia, Botswana, Uganda and Zambia. It sells branded and private label food products, which are distributed by subsidiary, Vector Logistics. The company owns the Rainbow Chicken brand as well as Five Star maize meal, Ouma rusks and Selati Sugar.

RCL Foods has said its chicken and logistics businesses have particularly hit by level 5 lockdown restrictions which prevented restaurants from opening. Since the beginning of June, restaurants have been allowed to open for takeaway collections and deliveries under level 3 of the lockdown regulations.

In FY 2019,  the group said its performance had been hit by the declining local market demand for sugary products as a result of South Africa’s newly imposed sugar tax.