In its interim results and cash dividend declaration for the six months ended 28 December 2025, the group reported revenue growth of 11,3% to R8,8 billion, while earnings before interest, tax, depreciation and amortisation (EBITDA) rose sharply by 81,4% to R1,1 billion, both compared with the same period in 2024.
Headline earnings and headline earnings per share more than doubled during the period, increasing by 110,8% to R669,6 million and by 109,9% to 74,81c, respectively.
In response to questions Farmer’s Weekly sent via email, Rainbow CEO Marthinus Stander attributed the improvement to a strong focus on cost management, agricultural performance, and operational efficiencies across the value chain, along with stronger demand, improved pricing, and a more favourable channel and product mix.
Growth strategy
According to the results report, Rainbow continues to focus on disciplined capital investment aimed at improving operational efficiency, increasing capacity, and mitigating biosecurity risks as part of its growth strategy.
Over the six-month period, replacement capital expenditure amounted to R287,5 million, while expansion-related capital expenditure totalled R2 million.
Furthermore, while capital commitments amounting to R123,3 million had been committed, they remained unspent at the end of the period, while an additional R248 million had been approved and was yet to be contracted.
Key capital initiatives included enhancements to processing and farming equipment, biosecurity investments to control avian influenza, the upgrade of the grandparent hatchery, investment in water filtration systems, and the commencement of phase two of the IT separation project as part of Rainbow’s transition from the former RCL Foods’ platforms.
The report also revealed that water and energy security are key strategic focus areas for the group. Capital investments are therefore being planned over the next five years to secure affordable and reliable and affordable supply while minimising operational disruptions and supporting business continuity.
Chicken division
Revenue in the chicken division increased by 11,5% to R7,75 billion, while EBITDA grew by 126,2% to R819,7 million.
Stander identified feed costs as the single biggest cost component in poultry production, meaning movements in feed prices have a significant impact on profitability.
“During the period, lower feed input costs contributed positively to the performance of the chicken division, alongside strong demand and continued improvements in agricultural and operational performance,” he explained.
Looking ahead, he said commodity markets remain inherently volatile.
“While recent conditions have been favourable, feed prices are influenced by global grain markets, exchange rate movements, and weather conditions. As a result, Rainbow continues to focus on the factors within its control, including agricultural efficiency, feed conversion, and cost discipline across the value chain.”
Over the past two years, the group has doubled processing capacity at its Hammarsdale facility in Durban, KwaZulu-Natal, rolled out new technologies, and upgraded its core assets.
Animal feed division
Rainbow’s strategy for its animal feed division is anchored in supporting the expanding internal requirements of the growing chicken division, reinforcing the group’s vertically integrated operating model, according to the report.
In parallel, a meaningful portion of the total feed production is supplied to external customers, positioning the division as a business of scale and a competitive growth platform in its own right.
For the period, the division’s revenue increased by 1,7% to R3,69 billion, driven mainly by higher volumes across internal and external channels, although selling prices were marginally lower than in the previous period due to reduced commodity input costs. EBITDA increased by 0,4% to R212,6 million.
Beyond its core poultry business, the company is also investing in sustainability initiatives that convert waste generated in its operations into renewable energy.
Rainbow’s waste-to-value division, run through its Matzonox joint venture, reported a decline in revenue of 1,3% to R55,9 million and a drop in EBITDA of 11% to R20,4 million compared with the previous period, largely due to the non-renewal of a contract for the sale of green gas certificates.
However, the impact was partially offset by additional revenue generated from electricity and water production at the facilities.
Stander explained that the waste-to-value operation processes organic waste streams from poultry processing through anaerobic digestion at facilities in Worcester in the Western Cape and Rustenburg in North West. This process converts waste such as wastewater sludge and poultry litter into biogas, which is then used to generate renewable energy.
During the six-month period under review, the two plants generated about 7GWh of renewable energy, including electricity and thermal energy. All of this energy is used internally within Rainbow’s operations.
“The electricity powers processing activities, while the heat and steam replace coal in our energy-intensive operations,” Stander said.
The system also produces organic fertiliser while treating wastewater and poultry manure, contributing to improved resource efficiency and reduced environmental impact.
Empowerment
Rainbow also continues to support emerging poultry farmers through the supply of day-old chicks, feed, and technical support.
According to Stander, the initiative currently focuses on KwaZulu-Natal, Limpopo, and Mpumalanga, aiming to help small-scale and previously disadvantaged growers participate more fully in the poultry value chain.
By shortening the supply chain and improving access to inputs and technical support, the programme seeks to create opportunities for these farmers to build sustainable poultry enterprises while supporting economic activity and job creation in rural communities.
Meanwhile, Rainbow is cooperating with the ongoing market inquiry by the Competition Commission of South Africa into the structure of the poultry industry.
Stander said it is important that the inquiry recognises the structural realities of poultry production.
“The industry relies on integration and scale to achieve efficient, low-cost production, which ultimately benefits South African consumers by helping to keep chicken affordable as the country’s most widely consumed source of animal protein,” he said.
He added that maintaining the local poultry sector’s competitiveness is crucial for its long-term sustainability and growth.
